CommLawBlog

You weren’t planning on taking summer vacation this year, were you? Good, because the dates for Auction 98 have now been set, and it looks like they’ll suck up most of the summer. So get out your calendar and mark these dates:May 18, 2015 – 12:00 noon ET –Short-Form Application (FCC Form 175) filing window opens.May 28, 2015 – prior to 6:00 p.m. ET –Short-Form Application (FCC Form 175) filing window deadline. The deadline for applications marks the beginning of the FCC’s very strict anti-collusion period. Bidders that intend to form consortia or otherwise partner with other bidders should have reached an agreement and disclosed it to the FCC by this deadline. Auction communications between or among bidders after this date could expose bidders to disqualification and hefty fines.June 29, 2015 – 6:00 p.m. ET –Upfront Payments (via wire transfer). Based upon the markets that a bidder has selected in its May Short-Form Application, funds must be wired to the FCC as an upfront deposit to prove that the bidder is genuinely interested in participating in the auction.July 23, 2015 –Auction Begins.At least a week before the July 23 start date, the FCC will let bidders know how many rounds of bidding will take place during the first few days. Depending upon the level of participation, it may take as little as a few days or as many as several weeks for the auction to end. The FCC’s anti-collusion rules will remain in effect throughout the auction (and for some time beyond the close of the bidding – keep an eye out for an announcement of when the coast is clear). Those rules should be carefully followed.The auction will look much the same as previous sales conducted by the FCC, at least in terms of the procedures. Unlike previous auctions, though, the FCC has not jiggered with the list of construction permits for sale – so all 131 permits listed in the Commission’s initial public notice about Auction 98 last month will be up for grabs. The only change: at the request of one commenter, the Commission has reduced the minimum opening bid for the Maysville, Georgia CP by more than 50% – from the asking price of $75,000 listed in the March public notice to a far more reasonable $35,000. (The commenter may still be disappointed, though; he had asked that the opening bid be knocked down to $30K.) Here’s the final list.The permits available this time around lack some of the pizzazz of earlier auctions. Nothing in the seven figures … or six figures, for that matter. In fact, only three permits are sporting minimum opening bids of more than $50K: Columbia, Missouri (the priciest of the lot, at $75,000) and Cottonwood and Shasta Lake, California ($60,000 each). Bargain hunters may be interested in the cheapest listed permit – a paltry $500 for Memphis! Um, that’s Memphis, Texas, not Tennessee. (Sanderson, Texas and Guthrie, Texas are also listed at $500.) There are plenty of others at $10K or less, including Muleshoe, Texas, which comes in at a surprisingly high $10,000. Bear in mind, too, that the 131 available permits include 18 that have been listed in previous auctions. They either got passed over then or they were sold but not built – in other words, they may not present the best of all possible permits. But we encourage you to check all the permits out to see if any of them look like they’ve got your name on them (particularly if your name happens to be “Muleshoe”.)Anyone who has any potential interest in participating in Auction 98 should review the notice in detail. While there’s three months to go before the bidding starts, anyone interested in participating should take advantage of the time to perform due diligence about the channels they’ve got their eyes on. Remember what the Commission has said repeatedly in the past (and has said yet again in the Auction 98 Notice):The FCC makes no representations or warranties about the use of this spectrum for particular services. Applicants should be aware that an FCC auction represents an opportunity to become an FCC permittee in a broadcast service, subject to certain conditions and regulations. … An FCC auction does not constitute an endorsement by the FCC of any particular service, technology, or product, nor does an FCC construction permit or license constitute a guarantee of business success.(And yes, in keeping with tradition, the Commission itself made that ominous advisory even more ominous with the boldfaceemphasis.)The Commission is also offering an online auction tutorial, which should be available as of May 18, 2015. (Look for an “Auction Tutorial” link on the FCC’s Auction 98 webpage.) It’s for newbies or folks who want to re-gain their auction chops. (The online tutorial replaces the bidder seminars which the Commission offered in the run-up to previous auctions.)Additionally, the Commission will conduct a “mock auction” on July 20, 2015, again to permit folks to dust off any cobwebs and be ready to jump right in when the bidding starts for real on July 23.

Music industry and NAB gear up – again – for war over performance rights.Like the swallows returning to Capistrano, the debate about “performance rights” has again returned to Washington – this time signaled by the introduction of H.R. 1733, the “Fair Play Fair Pay Act” (FPFPA). While this year’s version of the perennial effort to impose additional copyright obligations on broadcasters features some new twists, its passage is far from guaranteed, although no one should be surprised if it advances at least part way through the legislative process.“Performance rights”, of course, is the short-hand expression for a particular type of copyright interest, one held by recording artists. The right covers the artist’s particular recorded performance. (For more detail, check out my 2009 blog about an earlier performance rights effort.) While the “performance right” has been around since the 1990s, broadcasters have not been subject to it. That’s because Congress acknowledged that recording artists and radio broadcasters enjoy a unique relationship through which each side benefits from the other: radio stations get program content from recording artists who in turn get free promotion from airplay. The classic win-win situation. Rather than disrupt that, Congress chose instead simply not to impose any performance rights obligations on broadcasters for over-the-air play. (Note: Webcasting is another story: broadcasters are liable for performance rights royalties for material that they webcast, even if that material is identical to the broadcaster's over-the-air programming.)But for years the recording industry has been pressing Congress to eliminate that exemption. The FPFPA – which is sponsored by a bipartisan group of folks including Rep. Jerrold Nadler (D-NY), Rep. Marsha Blackburn (R-TN), Rep. John Conyers (D-MI) and Rep. Ted Deutch (D-FL) – is this year’s try. It would amend the Copyright Act in several ways. You can read the entire 26 page bill if you want, but for a very good summary of all provisions, I suggest you check out this post from the Future of Music Coalition.How would this bill affect broadcasters?Negatively, of course. That’s because, where radio stations currently pay no royalties at all for the right to broadcast sound recordings over the air, FPFPA would require stations to pay some royalties – obviously a negative as far as broadcasters are concerned. The bill also specifically incorporates the “RESPECT Act”, which makes it clear that the performance right applies to pre-1972 sound recordings. (If you’re a regular CommLawBlog reader, you should recognize that, while Congress initially declined to create a performance right for pre-1972 recordings, a body of case law in state courts is moving in the opposite direction.)If FPFPA were to be enacted, how much would a station end up having to pay? We can’t say, at least with regard to most stations. The bill simply directs the Copyright Royalty Board (CRB) to get started “as soon as practicable” to develop royalty rates and terms. In doing so, though, the CRB will be subject to at least one major constraint: Another FPFPA section specifically says that, in setting rates, the CRB must employ the same “willing buyer/willing seller” standard it uses to determine the webcasting rates.But that doesn’t necessarily mean the resulting rate for broadcast performance rights would be the same as the “per performance”-based webcasting rate. That’s because the “willing buyer/willing seller” considerations in the over-the-air broadcast context are different from those in the webcasting context, even if the parties involved (i.e., radio licensees and recording artists) are the same in both settings. The assertion that radio airplay helps album sales would certainly come into play and could carry some weight in keeping the rates down. Plus, there may not even be a basis on which to impose a “per performance” rate upon an over the air service. You’d probably be more likely to see something tied to a station’s overall listenership, AQH numbers or revenue.We do know a couple of things about limits that the PFPFA would impose on rates:There would be a minimum fee for each station, meaning all stations would definitely be on the hook for at least some payment in the future if this bill passes; butFees would be capped for certain types of station. For instance, small commercial stations with an annual revenue of under $1 million (and this appears to be per station, not per company) would pay $500.00 per year. An FCC-licensed public broadcast station would pay no more than $100. No royalties would be owed for broadcast of music used in religious services or incidental uses of music (which may protect talk, sports and news stations).But the big questions I’ve been getting over recently are: (1) How likely is FPFPA to pass; and (2) if it does, when will I start paying more in royalties?As to whether, I think the odds are below 50% – probably between 25-35% – but they’re slightly higher than they have been in the past. The NAB continues to mount strong opposition to imposition of any performance right; its previous opposition has proven effective. And we have a pretty good idea of how many “NO” votes there might be, thanks to the Local Radio Freedom Act. That’s a nonbinding resolution which has been introduced in both the House (as H.Con.Res. 17) and Senate (S.Con.Res. 4) which simply says that:Congress should not impose any new performance fee, tax, royalty, or other charge relating to the public performance of sound recordings on a local radio station for broadcasting sound recordings over the air, or on any business for such public performance of sound recordings.Since the Radio Freedom Act is, in effect, the anti-FPFPA, it’s safe to assume that any member of Congress who signs on to one will vote against the other. Currently, the Local Radio Freedom Act is supported by 158 Representatives and 12 Senators. Of course, those who remember their U.S. government classes will know that 218 Representatives and 51 Senators would be needed to pass any bill. The Local Radio Freedom Act has always garnered at least 218 Representatives in the past.Keep an eye on the Local Radio Freedom Act, then, to get a good idea of whether the momentum is heading toward radio stations or recording artists. It’s interesting to note, for instance, that ten Representatives have signed on to the Local Radio Freedom Act since the FPFPA was introduced. Keep in mind, too, that many Representatives and Senators won’t commit on an issue until they absolutely have to. So while the Local Radio Freedom Act is currently 60 votes short of the crucial 218 that would signal likely defeat of the FPFPA, radio stations probably need to start worrying only if (a) the uptick in co-sponsors of the Local Radio Freedom Act stalls out and/or (b) we don’t see a similar bump result after significant upcoming mileposts in the legislative process, like a committee hearing or vote on the bill.I fully expect, by the way, that FPFPA will get both a committee hearing and a vote. Rep. Nadler is the Ranking Member of the Subcommittee on Courts, Intellectual Property and the Internet of the House Judiciary Committee. Rep. Conyers, an original co-sponsor of the FPFPA, is the Ranking Member of the full Judiciary Committee. Under these circumstances, protocol dictates that the bill would normally get a hearing and vote. I won’t be surprised if the bill passes out of the subcommittee and full committee.But what might happen on the House floor is another matter. Given the limited amount of time available to actual legislating in this, the 114th Congress, I’m not sure that this bill would get floor time this year even if the Local Radio Freedom Act doesn’t get the support of 218 Representatives or 51 Senators. And the fact that 2016 is an election year means that little will get done then; it also means that anything passing the House and Senate this year must be relatively non-controversial because floor time is too precious to waste on things like reasoned debate.Things could change, though. For instance, what if the performance right proposal were to be included in a broader bill in an effort to give some “wiggle room” to Representatives and Senators who are co-sponsors of the Local Radio Freedom Act. Would that give them the opportunity to somehow rationalize a vote for such a broader bill because, arguably, there are broader, more laudable interests at? Based on the plain language of the Local Radio Freedom Act, I’d still say “NO”.Another possible game-changer: the “divide and conquer” approach the FPFPA’s sponsors appear be taking. The capping of royalties for smaller commercial and non-commercial broadcasters is a pretty clear attempt to try force the NAB off its argument that a performance right will harm local broadcasters. After all (the argument would go), annual royalties capped at $500 aren’t all that onerous; that being the case, by opposing the FPRPA, the NAB is only trying to protect big corporate companies who can afford to pay. That spin by the FPFPA sponsors might garner a few votes to their side.As far as timing goes, if the bill is to pass at all, I think that would have to happen in 2015 or very early in 2016, since (as mentioned above) election year activities in 2016 will likely distract Congress. And if it doesn’t get passed in 2016, the process will have to start anew in 2017.Even if the FPFPA does pass, though, you’re likely looking at another year or two before royalties are imposed. Even if the CRB starts its rate-making proceeding “as soon as practicable” after the enactment of the FPFPA (as required by the bill), experience shows that such a proceeding can take as long as two years to complete. (Just look at the current Webcasting IV proceeding, setting the streaming rates for 2016-2020: it began in January 2014 and likely won’t conclude until December 2015.)So there is a lot in play here, especially with regard to politics. The bill’s passage still seems pretty unlikely and, even it were to pass, its effect may not be felt for several years, but the debate should be fun to watch.

Regulatory inaction preventing U.S. from taking advantage of latest E-band antenna technologyIt’s common knowledge that the FCC is determined to expand mobile connectivity. The Commission’s high profile efforts to make increasing amounts of spectrum available for that purpose – the much-ballyhooed spectrum incentive auction being the most prominent example – tend to dominate the current regulatory landscape. But what happens when the targeted spectrum is finally available for wireless purposes? When it comes to the nitty-gritty details governing use of the newly-available spectrum, will the rules and policies imposing those details be ready to maximize and optimize that use?On at least one front it looks like considerable prep work could be underway, but isn’t. The front we’re talking about: antenna regulations in the E-band frequency block that runs from 71-76 GHz and 81-86 GHz.The E-band, of course, is not part of the spectrum on the table in the incentive auction. But, particularly once the wireless beneficiaries of that auction begin to take advantage of their acquisitions, the E-band should play an important role. It is ideal for backhaul of wireless broadband signals, particularly in an urban environment where short-range, low power operations can be used in small cell systems. Small cell systems permit the efficient reuse of spectrum, obviously a desirable attribute.As public reliance on the vast array of available mobile devices continues to soar, small cell base stations are being deployed in greater numbers to bridge the network capacity gap. Small cells can do this only if they are deployed as close as possible to users. In many cases, “close as possible” means at or near street level where the options for locating antennas are limited. But such close-in installation of antennas raises a host of practical problems. Communities are highly sensitized to the aesthetics of base stations and wireless backhaul equipment in their immediate environment. Anything that stands out visually tends to meet strenuous opposition. And even if installation of such antennas is approved by local authorities, the cost and inconvenience of the actual installation can be a significant disincentive. Further, in urban areas inter-site distances are often only a few hundred feet, far less than the 1-3 mile distances for which traditional E-band parabolic antennas were designed.The ability to use small form factor antennas is likely to be critical to the acceptance and expansion of small cell wireless coverage for mobile users. But limits imposed by the FCC’s current rules governing antennas in the E-band preclude use of smaller, lighter, more unobtrusive antennas most suitable for deployment in cities.So if the Commission, looking into its crystal ball, foresees more and more small cell systems in urban environments, shouldn’t the Commission be getting set, now, to make sure that such systems can and will in fact be installed? You’d think so. And yet, for more than two years a couple of proposals looking to adjust the FCC’s antenna specs for the E-band have sat on a shelf somewhere in the Portals.In formal comments filed with the Commission (in 2012, 2013 and again in 2014), the Fixed Wireless Communications Coalition urged that the antenna standards for E-band operation be relaxed. And in 2013, Aviat Networks asked for a waiver of the existing antenna standards. Aviat is one of a number of manufacturers with products that utilize small flat-panel or ultra-small parabolic antennas suitable for backhaul operations in the E-band. But those antennas don’t conform to the current rules, so until the FCC modernizes its regulations, deployment of the latest antennas is simply impossible in the United States.No action has yet been taken on either request.This lack of action is puzzling. In view of the ordinary, seemingly unavoidable delays inherent in the rulemaking process, one might think that the FCC would at least want to start addressing rules which preclude, or at least discourage, efficient use of spectrum. Maybe issue a notice of proposed rulemaking, or at least solicit comments on the proposals. Anything to get the ball rolling so that the stage is properly set when the post-auction curtain opens. It would seem to be in everybody’s interest – including especially the entities who ultimately establish urban systems reliant on backhaul capacity – to ensure that, once the deployment stage arrives, the Commission’s rules permit optimal use of the available spectrum.While the FCC has taken no apparent action in the direction of permitting small antenna use in the E-band, our neighbors to the North haven’t sat idly by. Industry Canada (IC) is already allowing use of smaller antennas while its regulations are being finalized. IC’s decision to allow use of those antennas on an interim basis strongly suggests that IC is confident that they will comply with the rules that will eventually be adopted. Small form factor antennas are also authorized for use in Europe and other international markets. In other words, the soundness of the technology involved here has been established in real-world operation. That being the case, there is no apparent downside in the FCC joining its international confreres in permitting small antenna use – and, as noted above, there is considerable upside to doing so.The Commission’s plate is full to overflowing these days. Just sorting out the mind-numbingly complex reverse/forward auction could occupy the agency full-time, even without net neutrality, major media mergers, and other more mundane activities. But as a simple matter of planning, it would seem to make sense for the FCC to clear any obstacles that might slow down deployment of the most spectrum-efficient systems available.[Disclosure: Fletcher, Heald & Hildreth represents parties advocating for approval of smaller E-band antennas.]

FCC Chairman on offensive for proposed Field Office closures – but will "tiger teams" really do the trick?Word on the street (first reported last month by our friends at Radio World, as far as we can tell) is that the FCC’s Field Offices are on the budgetary chopping block: according to a memo reportedly circulating within the Commission (and co-authored by the Chief of the Enforcement Bureau and the Managing Director), the number of Field Offices would be sliced by two-thirds (from 24 to 8), and staffing would be cut almost in half (from 63 to 33). Field Offices in major cities – think Seattle, Denver, Boston, Philadelphia, Houston – would all be gone.Ding Dong, the (Enforcement) Witch is Dead! Good news, right?Not really.Sure, visions of surprise inspections and write-ups for hypertechnical violations may plague the fevered imaginations of some, but the fact is that Field Offices are, and have long been, the friend of the licensed, street-legal operator. As a practical matter, voluntary inspection programs have largely removed the threat of drive-by, “gotcha” inspections. And while we may all chafe a bit at the occasional citation for a broken tower fence lock or unmown grass at the transmitter, such things tend to be rare, at least for licensees who are reasonably attentive to regulatory compliance.More common are the situations when a licensed station encounters interference from some other source, often one it can’t identify on its own. Maybe it’s somebody suffering inadvertent frequency drift; maybe it’s intentional, malicious interference; maybe it’s a pirate; maybe it’s an unlicensed transmitting device working where or how it shouldn’t be. Whatever the case, your friendly local FCC official has just the right combination of technical expertise and regulatory muscle to resolve the problem.Recently, a client called about a problem with what the FCC field agents term a “malicious interferer”, one of those regrettably troubled individuals who choose to use transmitters (legally obtained or otherwise) to spew obnoxious content on licensed radio frequencies. In this instance, the interferer was broadcasting racial slurs and obscenities on frequencies used by universities and others, forcing them to cease (at least temporarily) using the equipment they were lawfully licensed to use. We reached out to the nearby FCC Field Office, which began an investigation that brought an agent to the location several times. Working with local law enforcement, the Field Office succeeded in scaring off the interferer. We suspect that this happens a lot more often than gets reported.In a recent post on the FCC’s blog, Commissioner O’Rielly acknowledged the continuing problem of radio piracy in no uncertain terms. (Sample quote: “If broadcasting were a garden, pirate radio would be poisonous crabgrass.”) And who does a legitimate broadcaster call to spray regulatory Roundup on that crabgrass? The local Field Office, of course. Which is one very good reason why slashing the availability of conveniently located field operatives is NOT a reason for celebration. (Unfortunately, while bemoaning the insidiousness of radio piracy, O’Rielly declined to take a position on the possible closure of Field Offices.)The persistent pirate plague is not the only concern. As the Commission encourages spectrum sharing, particularly where mobile, unlicensed transmitters are involved, the potential for unintended, unexpected interference will soar. What’s worse, the folks likely to be operating the interfering devices will probably not be communications professionals savvy in the art of spectrum use. Rather, increasingly they will be folks taking advantage, innocently or otherwise, of the vast array of equipment available on the legitimate open market or from less legitimate sources – think jammers, boosters and the like. These are not people likely to respond favorably when your chief engineer calls over to ask for some friendly cooperation in identifying and correcting incoming interference. Is this really the time to shrink the available governmental enforcement capability?Testifying on Capitol Hill, Chairman Wheeler (who thinks RIF-ing field offices is a good idea) described how effective enforcement could be accomplished with just a small handful of field offices. According to Wheeler, the Commission is contemplating use of a “tiger team” approach. Field agents assigned to the eight surviving field offices would be on call, ready to hop a plane at the drop of a hat and swoop in to respond to interference SOS calls. How would they schlep their gear? Why, “prepositioned equipment” would be cached at various sites around the country, based (apparently) on “population/spectrum use density”. On their way to a distress call, the tiger teams would apparently make a pit stop at the closest “prepositioned equipment” depot to pick up what they might need. Radio World reports that those sites would include Kansas City, Denver, Salt Lake City, Phoenix, Seattle, San Juan, Puerto Rico, Anchorage, Alaska, Honolulu and Billings, Montana.Now bear in mind that the eight remaining field offices would (again according Radio World) be in NYC, LA, San Francisco, Chicago, Atlanta, Miami, Dallas and Columbia, Maryland. Wheeler apparently believes that field agents can be expected to arrive on-site responding to calls for assistance anywhere in the country within 24 hours. It appears, though, that they would have to get there by flying commercial – no FCC-dedicated Globemaster (like S.H.I.E.L.D.’s “Bus”) or Invisible Jet (like Wonder Woman’s) is in the budget. Whether or not 24 hours is a reasonable expectation remains to be seen. But if a tiger team has to fly, commercial, to an equipment depot site and then somehow get to the place where the interference is occurring, 24 hours seems a bit optimistic.Both Chairman Wheeler and Enforcement Bureau Chief Travis LeBlanc delivered sales pitches for the anticipated down-sizing at the recent NAB Convention. They noted that: it has been some 20 years since a management evaluation has been made of FCC Field Offices; most of the employees at those offices are eligible for retirement, not all the employees are busy all the time; and FCC inspectors are operating with outdated equipment that the FCC plans to replace with funds saved from closing offices. They argued that deploying up-to-date equipment will more than offset the reduction in Field Office locations and personnel.One broadcaster in the audience at the NAB told LeBlanc that most stations around the country see local Field Office inspectors, not Washington headquarters, as the presence and personality of the FCC in their lives. When field inspectors visit, station staffs jump to attention, and the staffs know that they need to be able to demonstrate compliance with the agency’s requirements. A “tiger team” dispatched from afar just won’t have the same impact.Some are speculating that this proposal isn’t motivated solely by concern for efficiency and modernization. Rather, the suggestion goes, it’s designed to enable the Chairman to add more FTEs (that’s government-speak for budgeted positions) to the FCC headquarters staff to work on net neutrality complaints while avoiding a budget fight with a Republican Congress that is loath to support the net neutrality efforts. That seems an odd trade-off for an agency whose raison d’être since its inception has been the preservation of order and the prevention of chaos in spectrum use.The plan to down-size the Field Office operation has not formally surfaced. To the extent that reports about it have emerged, they have been met with considerable skepticism. As an example, Bob Weller of the NAB posted a strong piece (“Defanging a Paper Tiger”) on the NAB’s blog. It’s possible that such opposition may give Chairman Wheeler and Bureau Chief LeBlanc some pause … or not, as they seemed to stand their ground at the NAB convention. Check back here for updates.

Class drop-out tries to upset NBCUniversal settlement.Spring break is fading in the rear view. Summer’s just around the corner. Soon the interns will be flocking to your door – if they haven’t already jammed your inbox – all looking for an opportunity to add a way cool media-related internship to their résumés.So it’s a good time to remind you that you should think hard about whether you need to pay those interns instead of claiming that their “compensation” consists solely of school credit. I specifically use the word “compensation” and specifically put it in quotes because, if you’ve read any of our prior posts on this topic, you know that claiming school credit as interns’ compensation is a recipe for disaster. You’d be much better off if you were to take the time to study the Department of Labor’s Fact Sheet # 71: Internship Programs Under the Fair Labor Standards Act. That way you’re more likely to offer an internship program that falls on the right side of the “trainee/employee” line.And being on the right side of that line is important, because being on the wrong side can be very expensive. Just ask NBCUniversal.They got hit with a suit by three interns back in 2013. The suit blossomed into a class action, with thousands of other interns jumping on the bandwagon. The next thing you know, NBCUniversal is agreeing to settle out for $6.4 million. And even that may not be enough, because at least one intern in the plaintiff class isn’t happy with the settlement.Listen to the words of Dina Agusta, intern-turned-litigant. Last month she notified the Court that she objected to the settlement. The apparent terms of the settlement took $1.2 million or so off the top for the lawyers, with the rest allocated among the former interns themselves. Five of the plaintiffs would receive payments ranging from $2,000 to $10,000; the rest would get about $500 per internship. This didn’t sit well with Ms. Agusta, one of the $500 ticket-holders. In her letter she details various aspects of the settlement that appear unfavorable to the intern-plaintiffs, and wraps up by saying:I would be willing to risk the low ball offer and go to trial on this matter. … I wonder how many other class members when presented with this analysis would concur with my reasoning.It must be said that Ms. Agusta is acting on the advice (and with the continued pro bono representation) of her attorney/father. Still, having pointed out weaknesses she perceived in the settlement, has she led others to join her in opposition? Maybe not. But my guess is that at least a few individuals who were able to score a highly sought-after internship with a famous media company did so on the back of family connections. More than likely, those from prominent families probably count at least a lawyer or two among their kin.But even if they don’t, the word is out. Lawsuits continue to be filed. Settlements continue to occur and judgments continue to roll up. And if Ms. Agusta’s battle cry is heeded by other interns, lawyer-engineered settlements that happen to be particularly lawyer-friendly may not be as readily available down the line.I’m not saying that you absolutely have to pay your interns this summer (or any other time). But I am saying that, in my experience, most media companies have tended to rely on the tried and true “credits instead of cash or checks” formula when it comes to internships. Even if that approach may have held water previously, it has recently developed leaks galore. Given the cost of litigation – especially litigation that goes for almost two years, seems settled for $6.4 million and then may still result in more litigation – it makes simple financial sense to consult with an attorney to be sure that your internship program fully complies with all relevant federal and state employment laws. (Note: The FLSA does provide some exemptions for some smaller companies; an expert should be able to confirm whether or not any particular company rates an exemption.)[One interesting sidenote: In an earlier post I mentioned that one law firm in particular happened to represent intern-plaintiffs in a number of similar cases directed at big media companies. This was presumably not coincidental, because the firm was also responsible for a website, aptly-named www.unpaidinternslawsuit.com, seemingly designed to bring more potential plaintiffs in the door. That firm repped the intern-plaintiffs in the NBCUniversal case, and thus stands to rake in nearly $1.2 million if the settlement is approved. It’s also the firm against which Ms. Agusta rails with considerable ferocity in her letter to the Court. It would appear that the firm is now standing in Dr. Frankenstein’s shoes: its creation, the Class Action Intern-Plaintiff, originally seemed within the exclusive control of the firm. But, like Frankenstein’s monster, that creation (or, at least, one iteration of the monster, i.e., Ms. Agusta) has now turned on its creator. That’s probably not good news for the firm, or for media companies with flawed intern programs.]

Injuries, fatalities to tower workers prompt inquiry into possible regulation.Everyone in the communications industry must be concerned about the safety and well-being of the tower workers. Tower workers, quite literally, put their lives on the line to put up or keep up the towers that make communications possible. So we should all take notice that the Occupational Safety and Health Administration (OSHA) is considering whether it can, and should, take regulatory steps aimed at preventing injuries or deaths during tower work. In a formal Request for Information, OSHA has requested input that will help it figure out “what steps, if any, it can take to prevent injuries and fatalities during tower work.”OSHA’s interest here is not new. As we reported last year, an OSHA official, prompted by a rash of fatal tower accidents in 2013, issued a letter reminding all “communications tower industry employers” of their “responsibility to prevent workers from being injured or killed while working on communication towers”. Now it’s delving deeper into the tower business, casting a regulatory eye on safe work practices, training and certification practices for communication tower workers, and “potential approaches [OSHA] might take to address the hazards associated with work on communication towers”.Of course, a number of existing standards – developed both by OSHA and by other authorities – already apply generally to some aspects of the tower construction/maintenance process. (These include the “general duty to protect” workers imposed by Occupational Safety and Health Act.) But OSHA has no standards for comprehensive coverage of tower workers … not yet, at least.A problem confronting OSHA is the complex of business relationships in the tower business. While some communications companies own their own towers and contract directly with the construction/maintenance operations to do the work, in many other cases the towers are owned by dedicated tower companies who act as landlords, leasing tower space to those who need it. When a communications company seeks to install or upgrade its facilities, it typically will contract with a construction management company (known as a “turfing vendor”), which in turn hires subcontractors to complete certain parts of the project. Those subcontractors may further contract with still other, specialized companies to some of the work. The existence of so many layers between the communications company and the worker who actually does the work creates challenges for setting and enforcing safety rules to protect employees. Which participants in the process should be responsible for what aspects of the process, and to what degree?OSHA is seeking input from everybody involved in the tower business – workers, communications providers, and everybody in between in the construction/maintenance process. It poses 38 separate questions (several with subparts), some directed to specifically to workers, others addressed to anyone in the contract chain. The questions include: What are the hazards faced by workers? What safety-related factors come into play in the contracting and construction process? Are there any training or certification standards in current use, and is there a need for some industry-wide standards along those lines? How (if at all) are workers covered by workers’ comp and/or employer liability insurance? Could alternative tower designs improve safety? Should an OSHA standard be limited to tower used for communications purposes, or should it include towers used for other purposes? The list of questions is extensive and comprehensive.OSHA’s Request for Information developed out of a joint workshop organized by the Department of Labor, OSHA, and the FCC last fall, during which two panels explored (a) the causes and prevention of tower climber fatalities and (b) possible industry-wide solutions to reduce the risks faced by tower workers. (You can see a recording of the workshop here.) The Request for Information is the next logical step. If you participate in any way in tower industry, now is your chance to speak up. While it’s far from certain that OSHA will ultimately impose industry-wide standards, it’s clear that OSHA is thinking along those lines and is looking for guidance.Comments and other information will be due to be submitted to OSHA by June 15, 2015.

Action on AM rescue items may come soon, but things aren’t looking good for an AM-only FM translator window.About 18 months ago, the Commission adopted a Notice of Proposed Rulemaking (AM Revitalization NPRM) that represented, in the words of then-Acting Chairwoman Clyburn, “the next significant step in our effort to buttress AM broadcast service and ease regulatory burdens on AM broadcasters.” Commissioner Pai, a long-time supporter of the AM industry, declared the NPRM a “landmark effort … to energize the nation’s oldest broadcasting service”. Optimism ran high that AM was about to catch a break.Then things went quiet. We here in the CommLawBlog bunker have received a boatload of inquiries asking where the much-vaunted AM Revitalization proceeding stands. And now we have some idea: In a recent post on the FCC’s blog, Chairman Wheeler has announced that he “intends to conclude” this proceeding “in the coming weeks”.There’s good news and bad news here.On the plus side, the fact that the Chairman is looking to “conclude” the proceeding at all is a big step in the right direction. The word on the street has been that a draft decision had been prepared by the Media Bureau staff and delivered to the Chairman’s office some time ago, but Wheeler was not inclined to fast track it. Whether that was because of other distractions (net neutrality and spectrum auctions being two obvious examples) or because of internal disputes with one or more other Commissioners (e.g., AM cheerleader Commissioner Pai, who has found himself cross-wise with the Chairman on more than one occasion) or because of some other factor, it’s impossible to tell. But at least we now know that we can expect some movement.(The fact that we don’t have a specific time frame for that movement is, however, a bit disappointing. Wheeler says “coming weeks”; in a statement applauding Wheeler’s announcement, Pai expresses hope that action will be taken “in the next couple of months”. Weeks? Months? Hmmm. But let’s not look a gift horse in the mouth.)On the down side, there appears to be trouble ahead for possibly the most eagerly anticipated element of the revitalization proposal: a window for new FM translator applications that would be open only to AM licensees. While the Chairman, in his blog post, seems to approve of most of the proposals advanced in the AM Revitalization NPRM (we summarized those proposals here), he draws the line at an FM translator set-aside. He has two “concerns”. First, he seems to think that there may already be enough translators to take care of any AM licensees who want one. Second, he questions whether any new translator filing opportunity should be limited to AM licensees only.With all due respect, the raw number of FM translators currently authorized is irrelevant to the survival of AM stations if those translators don’t happen to be located in areas where AM stations can take advantage of them. As we have seen, the ability to move a translator to a place where it can be used by an AM licensee is narrowly circumscribed. Unless the constraints on such moves are significantly loosened, saying that there are plenty of translators around is like telling a guy in the middle of a desert that he doesn’t need to worry about water because there’s plenty of it somewhere on the planet – even if it doesn’t happen to be in the desert where he is.As far as an AM-only window goes, Wheeler thinks that spectrum availability should be an “open opportunity” that doesn’t “favor one class of licensees” to the exclusion of others. Perhaps. But in the AM Revitalization NPRM, the Commission (of which the current Chairman was then not yet a member) considered that question. It tentatively concluded that “an applicant-limited and technically limited window … will provide immediate benefits to the AM service without materially affecting future FM translator window applicants”; by contrast, “an open window could frustrate our goal of providing expeditious relief to AM broadcasters”.Those conclusions were, of course, tentative, so Chairman Wheeler is well within his rights to differ with them. But he should at least be prepared to acknowledge those earlier conclusions and explain why they weren’t valid or why, if they were valid, he is now inclined to ignore them.Perhaps the most intriguing aspect of all this is Commissioner Pai’s statement applauding Wheeler’s blog post. Pai makes no specific reference to the FM translator window proposal (and Wheeler’s apparent rejection of that proposal). Does that suggest that Pai would accept a revitalization order that does not include an AM-only translator window? That would be a major disappointment to many AM licensees. There is one glimmer of hope, though. In his statement, Pai observes that “there is nearly unanimous support in the record for the ideas put forward by the Commission under Acting Chairwoman Clyburn’s leadership”. Those ideas included the AM-only translator window. Is it possible that Pai is looking to form a three-vote bloc (with fellow Commissioners O’Rielly, a Republican, and Clyburn, a Democrat) intending to embrace, among other proposals, an AM-only window? Obviously, this is pure speculation, but it’s at least something to think about.In any event, the AM Revitalization proceeding appears to be about to break through whatever bureaucratic logjam it’s been bottled up in. We can all keep our fingers crossed. (Of course, you should check back here for updates.)

One more step toward the incentive auction ...Late last year we reported on a draft of Form 2100, Schedule 381. That’s the form (technical title: “Pre-Auction Technical Certification Form”) to be completed and filed by (a) all full-power and Class A TV licensees entitled to mandatory protection in the upcoming incentive auction as well as (b) those with Commission-afforded discretionary protection. (Don’t worry if you’re not sure whether you’re in the universe of those who will have to file: the FCC is going to be releasing, possibly by the end of this summer, an “Eligibility Public Notice” spelling out the facilities that the Commission believes to be entitled to protection.) Schedule 381 is designed to provide the Commission assurance that the technical profile of the television industry as reflected in the FCC’s database is accurate.The latest news: The Office of Management and Budget has approved Schedule 381, so the form is now technically “effective”. It doesn’t appear to have changed significantly since our December, 2014 report on the draft. You can check out a copy of the schedule on the OMB website.The deadline for completing and filing Schedule 381 has not yet been set. It’s expected to be announced in the Eligibility Public Notice. Still, many if not most affected licensees presumably know whether or not they’ll be on the list. Anybody likely to be on the list would be well-advised to take a close look at the form – NOW – and begin to gather the necessary information. Some should be relatively easy – transmitter and antenna specs in particular. Other stuff, not so much. F’rinstance, do you know when the last structural analysis of your tower was performed? How about the structural standard under which that analysis was performed? (Hint: Two possibilities are TIA 222-Revision F and TIA 222-Revision G. There’s also a general “Other” option – you’re on your own for that one.)The information gleaned from Schedule 381 will be used by the Commission both to identify the facilities to be sold in the reverse auction and to form the starting point for the spectrum repacking effort which is the ultimate goal of the auction. Additionally, the completed forms will provide the FCC with a comprehensive database of all the specific transmission equipment (transmitters, antennas, transmission line) currently in use, a database which will be used in determining relocation reimbursements.In other words, Schedule 381 information will be central to the incentive auction process and its aftermath. That being the case, everyone will be best served if that information is collected and reported with the utmost accuracy.Check back here for further developments as they arise.

Get your calendars out. It’s time to calculate the date by which petitions for judicial review of the FCC’s Open Internet Report and Order (R&O) must be filed. That’s because the event that triggers that calculation – publication of the R&O in the Federal Register – has now occurred.Petitions for review of this kind of FCC proceeding are due to be filed within 60 days of the release of the agency decision. The date of “release” is the date of Federal Register publication, i.e., April 13. That means that petitions for review of the R&O by a federal appeals court must be filed no later than June 12, 2015. BUT if you’ve got your heart set on having the appeal heard by a particular circuit, you should definitely NOT wait until the last minute.That’s because, if petitions are filed by different parties in different circuits, a lottery is conducted by the Judicial Panel on Multidistrict Litigation (JPML) to choose one of those circuits to be the court which will hear the appeal. And to get your preferred circuit’s ball into the JPML drum from which the random selection will be made, you have to file your petition with your preferred circuit no later than April 23 (i.e., ten days after Federal Register publication). And that’s not all. Once your petition’s been filed, you have to have a paper copy of it, showing the dated “received” stamp from the court, delivered to the FCC’s Office of General Counsel – also no later than April 23. (Since that latter copy has got to be in the hands of the General Counsel within that 10 day period, hand-delivery is the recommended approach.)The General Counsel’s office will then notify the JPML of the circuits that have made the cut, the JPML will conduct a random drawing and announce the winner, all the cases will then be shipped to that lucky court where they will be consolidated … and then let the fun begin!The prospect of a random drawing gives rise to the potential for office pools galore. Which circuit will be selected? Which circuit(s) will be included in the drawing? How many different petitioners are going to file by April 23? The list goes on. You’re probably wondering what the chances are that petitions will be filed in more than one circuit. That’s easy: The chances are extremely good. We know that because two parties already filed for review before the technical release of the R&O, as we previously reported. There’s no reason to assume that, having already prepared the paperwork, those two won’t file again now that the R&O’s release is official. How many circuits might be in the drawing? Hard to say, but remember that, the last time the FCC issued a decision in the Open Internet proceeding, a total of six circuits were in the running: First, Second, Third, Fourth, Ninth and D.C. And remember, too, that one of the premature petitioners this time around went to the Fifth.The Federal Register publication also starts the 60-day countdown to the effectiveness of some, but not all, of the new net neutrality rules. The technical effective date is therefore April 23. BUT the modified information collection requirements in paragraphs 164, 166, 167, 169, 173, 174, 179, 180 and 181 of the R&O won’t kick in until the Office of Management and Budget has signed off on them pursuant to the Paperwork Reduction Act.And, of course, there’s always the possibility that one or more folks may file for a stay. That adds still more items for your office pool. Check back here for updates.

Last week we reported on the FCC’s Notice of Proposed Rulemaking (NPRM) triggered by the STELA Reauthorization Act of 2014 (STELAR). The NPRM has now been published in the Federal Register, which sets the deadlines for comments and replies. Comments may be filed by May 13, 2015 and replies by May 28. Comments and replies may be filed through the FCC’s ECFS online filing system; refer to Proceeding No. 15-71.

If you’re a broadcaster and you’re worried that you may have violated the on-air contest rule – or if the FCC has concluded that you did violate that rule – you may be in luck.As we all know, the hilariously-named Paperwork Reduction Act (PRA) requires the FCC to get the approval of the Office of Management and Budget before the FCC can unleash “information collection” obligations on its regulatees. The PRA process – which provides not one, but two separate opportunities for public comment, thereby ironically doubling the potential paperwork to be created – often appears to involve little more than rubber-stamping, with no apparent attention paid to any public input that might be submitted.What does this have to do with the FCC’s contest rule? Read on.As it turns out, there is a nugget of considerable value in the PRA. It prohibits the FCC from imposing “any penalty” on anybody for failing to comply with an “information collection” that does not happen to have an official OMB Control Number reflecting compliance with the PRA. That prohibition – set out in 44 U.S.C. §3512 of the U.S. Code – is an absolute get-out-of-FCC-jail-free card: Congress expressly provided that the prohibition against penalties applies “notwithstanding any other provision of law”. And if that didn’t make it clear enough, Congress went on to say that “The protection provided by this section may be raised in the form of a complete defense, bar, or otherwise at any time during the agency administrative process or judicial action applicable thereto.”(If you want to check on FCC “information collections” that have already passed muster, you can find them all listed, with their respective OMB Control Numbers, in Section 0.408 of the Commission’s rules. It’s an impressive list.)When the FCC wants to get an OMB Control Number for an “information collection”, it must first place a notice in the Federal Register inviting the public to comment on the “information collection”. These notices are akin to the legal notices that appear, usually in about 2-point type, at the back of your local newspaper. They’re a formality, supposedly intended to put the world on notice, but seriously, who ever reads these things?We do.And so it was that we came across a terse PRA notice in the Federal Register announcing that the FCC is seeking an OMB Control Number relative to Section 73.1216, its broadcast contest rule. According to the notice:The Commission adopted the Contest Rule in 1976 to address concerns about the manner in which broadcast stations were conducting contests over the air. The Contest Rule generally requires stations to broadcast material contest terms fully and accurately the first time the audience is told how to participate in a contest, and periodically thereafter. In addition, stations must conduct contests substantially as announced. These information collection requirements are necessary to ensure that broadcast licensees conduct contests with due regard for the public interest.Elsewhere in the notice the Commission seems to characterize Section 73.1216 as an “[e]xisting information collection in use without an OMB Control Number.”And what does the PRA call an information collection without an OMB Control Number? Unenforceable.Precisely why the FCC has decided now, nearly 40 years after the contest rule was first adopted, to declare the rule to be an “information collection” isn’t clear. But it seems to have done just that. And it is beyond question – as the PRA notice expressly concedes – that that information collection has been in use by the FCC without an OMB Control Number. So it sure looks like the Commission has effectively announced that, at least until the PRA process runs its course and a Control Number is issued, the FCC is not in a position to enforce the Contest Rule.How this development might come into play in connection with current, ongoing investigations into possible contest violations isn’t clear. Nor is it clear how, if at all, this might affect previously-issued fines for contest violations. But if you happen to have a contest problem on your hands, you might want to make sure that your counsel is aware of the Federal Register notice (as well as 44 U.S.C. §3512).Of course, given the terseness of the PRA notice, we may be missing something here. If so, ideally the Commission will clarify what’s going on. In the meantime, broadcasters who run on-air contests should take a look at the PRA notice for themselves.

[Blogmeister’s Note: Our colleague, collaborator, frequent CommLawBlog contributor and, most importantly, friend, Mitchell Lazarus, has asked us to post the following item. It doesn’t address any of the subjects we usually cover here, but so what? It being all too easy for us to lose sight of our capacity to help one another, we think it’s right to pass along to our readers a reminder of the importance of lending a hand.]I am writing from a hospital room, hooked up to a machine that delivers multiple chemo drugs into my veins. The dosage is high enough to kill my leukemia cells before they kill me. The problem is, that level of chemo also stops the “stem cells” in my bone marrow from supplying me with fresh blood cells. My blood counts will soon drop to near zero. This puts me into a non-survivable situation.But I still expect to walk out of here in a few weeks. What will save me is an infusion of stem cells from an anonymous donor, somebody in a database who is a fortuitous ten-for-ten match with my cell type. This person has taken time out of his (or her) life to undergo repeated testing and get injected with medication to step up the production of his stem cells. By now my donor has spent a few hours hooked up to a machine that extracts the surplus stem cells, which will soon be couriered to my bedside – all to save the life of a person whose name he is not allowed to know.I fervently wish I could tell my donor how much his contribution means to me. It is not likely he reads CommLawBlog. But other donors probably do, and their patients are as deeply thankful to their donors as I am to mine. Here in the hospital, patients talking about their donors almost always tear up in gratitude.I am lucky; not every patient who needs a matching donor has one. Possibly you could be the donor who saves the life of a total stranger, with no compensation except the inconvenience. Start at this website. There can be no greater gift one human can give to another. To my own donor, whoever and wherever he is: I’ll never be able to pay you back, but I sure wish I could try.

Some old, some new standards likely for MVPD, satellite market modification proceedings, thanks to CongressWhen you think of satellite TV, with its nation-wide reach, you may not immediately think of “local” service. But local service is an important element of Sat TV, and the FCC is now developing a way to tweak local TV markets for satellite carriage purposes.Carriage of a TV station’s signal, whether by terrestrial MVPD’s or by satellite services (i.e., DISH and DirecTV), is dependent to a significant degree on the market to which the station is assigned. A station’s local market affects both its claim to mandatory carriage and the MVPD/satellite operator’s ability to take advantage of the compulsory copyright license. But the market to which a station is technically assigned by Nielsen – whose DMAs are used by the FCC to define TV markets for carriage purposes – does not always reflect the station’s actual audience. In order to insure the ability of stations to better serve their local communities, the Commission has long provided a process for “market modification”, a process by which a station’s community of license can be added to or deleted from a particular Nielsen DMA. But that process has thus far been available only with respect to cable carriage.Now the FCC is proposing a market modification process for satellite carriage as well.This development doesn’t come as a surprise. Late in 2014 (as we reported), Congress passed the STELA Reauthorization Act of 2014 (STELAR), in which Congress spelled out how changes to local stations’ markets should be determined for satellite carriage. Congress ordered the Commission to adopt rules implementing Congress’s specifications. The FCC’s proposal would do just that.The rules that Congress devised and the Commission has now proposed would treat market modifications in the satellite context largely as such modification have been treated in the cable context. Under current cable market modification rules, the Commission considers four factors in assessing a market mod request:

Last gasp appeal comes up big, possibly saving 689 24 GHz and 39 GHz licenses.If you took the long odds and bet against the FCC in FiberTower’s last gasp effort to keep its 689 licenses alive, lucky you! The D.C. Circuit appears to have given FiberTower at least a chance.FiberTower’s saga goes back several years. Check out our blog posts on that saga for a more complete history. In sum, FiberTower had 689 licenses in the 24 GHz and 39 GHz bands that the FCC cancelled for failure to construct sufficient facilities. FiberTower appealed.At first glimpse, the Court’s opinion looked like bad news for FiberTower. A statutory argument it presented to the Court got tossed immediamente because it hadn’t been presented to the FCC below, as required by Section 405 of the Communications Act. And FiberTower’s arguments about the FCC’s interpretation of its substantial service renewal standards – i.e., that that interpretation is bad policy – didn’t get very far either (thanks to the deference to which the FCC is ordinarily entitled).But in the renewal applications relative to 42 of its licenses, FiberTower had indicated that it had in fact completed some link construction and initiated some service. The FCC’s orders had not addressed those showings at all. In fact, the Commission had even gone as far as saying that there had been “no construction of any facilities whatsoever” and “FiberTower was seeking a finding of substantial service without any construction of facilities.” Since (in FiberTower’s view) its showings haddemonstrated construction of at least 42 licenses (and satisfied the Commission’s “substantial service” standard), the Commission’s failure to address those showings was fatal error, at least as far as those 42 applications were concerned.Before the Court, the FCC countered that FiberTower hadn’t raised that particular argument before the agency. (This was the same Section 405 approach that the Commission won on with respect to one of FiberTower’s statutory arguments.) But, wouldn’t you know it, FiberTower had raised it – albeit somewhat obliquely and with virtually no detail – in an application for review it had filed with the Commission. That being the case, the FCC had been given an “opportunity to pass” on the issue, which is all FiberTower needed to do in order to allow it to make the argument to the Court.In response, the Commission appears to have argued that it didn’t really need to look at each and every substantial service showing before tossing them all. The Court disagreed: “[I]t ill behooves the Commission to imply that it can cancel licenses for failure to show any construction without reviewing each substantial service showing.” Since the agency record relative to the 42 licenses was silent, the Court remanded those 42 licenses back to the Commission for further consideration.So FiberTower ends up with 42 and loses the other 647, right? NOT. As it turns out, all the licenses were set to expire in June, 2012. FiberTower had requested a waiver of that deadline, which the FCC denied. But in so doing, the Commission had “acknowledged that the proportion of licenses that have been built out may be relevant to its extension analysis.” In other words, if some of the licenses had been built out, an extension of all of them might be warranted. Since 42 of the licenses might indeed have been built out, the possibility exists that, upon consideration of that fact, an extension with respect to all FiberTower’s licenses might be in order. Accordingly, it appears that the Court has left open the prospect for renewal/extension of all 689 licenses.So FiberTower’s 689 licenses appear to live on. The likelihood that the FCC will eventually relent and leave them all in place is impossible to gauge at this point, but at least FiberTower’s prospects are better now than they were before the Court’s opinion.

Panel picks despite possibly premature petitions.The next time you find yourself at a roulette table in the Net Neutrality Casino, put all your chips on “D.C. Circuit”. It’s a good bet.As readers may recall, back in 2011, the D.C. Circuit came out on top in a lottery conducted to determine which of six federal courts of appeals should hear appeals of the FCC’s Open Internet decision. And now, nearly four years later, lightning has struck again, with the prospect for a three-peat in the very near future.The lottery involves the Judicial Panel on Multidistrict Litigation (JPML). The JPML decides which court gets to preside over appeals of FCC actions when different appellants file their petitions for review in different courts. When that happens, the competing circuits are tossed into a drum and one is picked by a JPML official (the “Random Selector”). All appeals of the FCC action in question are then consolidated before that one lucky court. (There are other niceties that have to be attended to in order to get your favorite circuit into the drawing, but you get the idea.)The Commission released its much-anticipated Open Internet Report and Order on March 12, 2015. And on March 23, two parties filed for review: the United States Telecom Association in the D.C. Circuit, Alamo Broadband in the Fifth Circuit. Presumably each had its own reasons for choosing its particular circuit. The D.C. Circuit has not been particularly kind to the FCC on the net neutrality front the first two times that issue has been before that Circuit, which suggests that maybe it’s the place for petitioners to go. But the FCC did, in the eyes of many, make some headway the last time around. That might suggest that petitioners shouldn’t give D.C. a third shot. Why the Fifth Circuit? Who knows?While both petitioners may have jumped the gun ever so slightly (more on that below), the FCC duly notified the JPML of the filings, a lottery was conducted and, wouldn’t you know it, the D.C. Circuit’s number came up. (Curiously, the JPML notice indicates that Alamo filed in the Ninth Circuit, rather than the Fifth. After checking the relevant dockets, we’re reasonably sure that the Fifth is where the petition went, but at this point it’s probably not important.)D.C. Circuit fans shouldn’t get too excited about this, though. As the Commission pointed out to the JPML when it sent the notice of the petitions over, the period during which judicial review of any document issued in FCC rulemaking proceedings starts when the document is published in the Federal Register. (That’s what Section 1.4 of the FCC’s rules says.) Since the Open Internet decision hadn’t made it into the FedReg before March 23, there was technically nothing to appeal, so the petitions for review were premature and should, in the FCC’s view, get tossed.The FCC is probably pretty confident about this particular argument because, just four years ago, the Commission got a similarly premature petition for review (filed by Verizon) tossed out on the same basis. And it was the D.C. Circuit who did the tossing. So the Commission’s looking good this time around.Interestingly, rather than move to dismiss the latest petitions separately in the courts where they were first filed, the Commission opted to have the JPML conduct its lottery. Now that the JPML has selected D.C. to hear the consolidated appeals, the FCC plans to move that court to dismiss the whole shebang. Look for that to happen shortly – and, since the lucky court happens to have reacted favorably to the FCC’s argument before, it’s probably a good bet that the petitions will be dismissed.That doesn’t mean that the Open Internet decision will avoid judicial review. Once the order makes it into the Federal Register, look for a bunch of petitions for review to roll in. If those petitioners choose different circuits – and, from what we’ve seen already, that’s likely to happen – the Open Internet proceeding will be making another pit stop at the JPML, almost certainly setting up the three-peat opportunity for the D.C. Circuit. Now’s the time to get your office pools organized.

Our Internet guru digs deep into the Open Internet decision and comes up with … questions.I recently posted an item summarizing the broad strokes of the FCC’s new “Open Internet” (a/k/a net neutrality) rules and policies. Since the full text of those rules, and the accompanying Report and Order (“R&O”), had not been released when my summary was prepared, I had to work from the then-available public notices from the FCC. Now that the R&O is out, I’ve had a chance to slog through its 360+ pages of dense text, which has led me to one obvious conclusion: the R&O raises as many questions as it attempts to answer. Let’s look at two of particular aspects of the FCC’s decision that give rise to some of those questions.Extending full net neutrality obligations to mobile broadband: What’s the number?Historically, when it came to broadband Internet service, FCC efforts to craft Open Internet rules and policies drew a clear line between (a) fixed/wireline providers and (b) mobile providers. Mobile providers were regulated far more lightly than their fixed/wireline counterparts because of a number of distinctions between the two. In particular, mobile broadband networks at the time featured less speed and less capacity, meaning that more intrusive traffic management was acceptable on the mobile side because it was, as a practical matter, necessary. Further, consumers enjoyed some measure of protection simply because there was competition among mobile providers.But over the years, things have changed. As the Commission views the situation now, the once nascent mobile broadband service market has matured and now boasts sophisticated speed and data transmission capacity (Can you spell 4G and LTE?). Many consumers (especially those in low income brackets) rely primarily on mobile devices for Internet access. So in the FCC’s view, the time has come to apply to mobile providers the same rules and policies that it applies to fixed providers. Of course, continuing technical differences between the two mean that some different standards may be appropriate with respect to traffic management techniques. Nevertheless, the FCC has decided to bring mobile broadband service providers into the Net Neutrality big leagues.But wait. If mobile broadband access providers are now among the ranks of the fully-regulated, does that mean that the public switched network now includes public Internet Protocol (IP) addresses as well as regular old telephone numbers?This question arises because, in crafting its latest version of Open Internet rules, the Commission has declared broadband Internet access service to be a “telecommunications service” subject to common carrier regulation under Title II of the Communications Act. In the view of some, the FCC had to take that step in light of two court decisions rejecting earlier stabs at neutrality rules. Whether or not that was in fact the case, broadband Internet access service – both fixed/wireline and mobile – is now a “telecommunications service”.Under Section 332 of the Communications Act, however, a mobile service can’t be treated as a telecommunications service unless it meets the definition of commercial mobile radio service (CMRS). And that definition requires that a CMRS operator must provide a service that is interconnected with the “public switched network”. The term “public switched network” refers generally to the traditional telephone system, with wires (or fiber), poles, switching centers … and phone numbers. In fact, until the R&O the Commission defined the public switched network as[a]ny common carrier switched network … that use[s] the North American Numbering Plan in connection with the provision of switched services.The North American Numbering Plan involves telephone numbers, not IP addresses. Broadband Internet access providers don’t use telephone numbers; they use IP addresses. (IP addresses have historically consisted of four decimal numbers, ranging for 0 to 255, separated by dots – for example, 38.100.34.29. A new numbering protocol – IPv6 – with even more characters is being deployed, but let’s not get into that right now.) In order to insure that mobile broadband service is a CMRS and, thus, that it can satisfy the statutory requirements for a “telecommunications service”, the Commission had to expand its definition of “public switched network” to include interconnection with IP addresses. The definition now reads:[a]ny common carrier switched network … that use[s] the North American Numbering Plan, or public IP addresses, in connection with the provision of switched services.That might not be a major consideration but for the fact that IP addresses are currently regulated not by the FCC, but by the Internet Assigned Numbers Authority (IANA) of the International Corporation for Assigned Names and Numbers (ICANN), under a contract from the U.S. Department of Commerce. And as it happens, given the global nature of the Internet and IP addresses, the U.S. Government has been committed for nearly 20 years to transition key Internet domain name functions to the global multi-stakeholder Internet community, a process which is well underway. In other words, control of the IP addressing system has never been and is not likely ever to be within the FCC’s control.In a welcome show of humility, the FCC acknowledges in the R&O that its expansion of the definition of “public switched network” to include public IP addresses “in no way asserts Commission jurisdiction over the assignment or management of IP addressing ….” That’s nice, but it underscores the fact that a critical definitional element of the FCC’s new net neutrality approach is dependent on a factor – the assignment of IP addresses – over which the FCC has no control. You can bet that this issue will be part of any appeal by wireless carriers attacking the FCC’s reclassification of mobile broadband Internet access service as a Title II CMRS.Who will regulate privacy?Common carrier regulation under Title II encompasses a wide range of regulatory requirements that could be imposed by the FCC. But the Act gives the Commission the opportunity not to subject Title II regulatees to all possible requirements. If it so chooses, the FCC may “forbear” from applying some of those requirements. In the R&O the Commission provides a detailed analysis of the Title II statutory provisions that it will apply to broadband Internet access providers and those from which it will forbear. One area over which the Commission clearly asserts jurisdiction – while forbearing at this time from imposing its existing rules – is consumer privacy. It states that it will apply the requirements of Section 222 of the Act to broadband providers, although it will forbear from doing so pending adoption of new rules in a separate rulemaking proceeding.Need a quick refresher on Section 222? Its formal title is “Privacy of Customer Information”. Section 222(a) requires every telecommunications carrier generally to protect the confidentiality of “proprietary information” of its customers. The FCC interprets “proprietary information” to include “private information that customers have an interest in protecting from public exposure”. Section 222(c) imposes specific obligations relating to the separate category of “Customer proprietary network information” (CPNI). CPNI has a complex definition; to simplify, think of it generally as records relating to quantity, type, destination, location, amount of use and configuration of service. Section 222(c)(1) requires that, when a carrier gets hold of CPNI as a result of the carrier’s provision of telecommunications services, the carrier canonly use, disclose, or permit access to, “individually identifiable” CPNI in its provision of the services from which the information is derived (or underlying services). The Commission has consistently been a stickler on the Section 222(c) CPNI front.Just last October, however, the FCC expanded its interest in enforcing privacy interests more broadly than CPNI. For the first time, it took action under Section 222(a) (and section 201(b)) against two telecom companies for storing customers’ “proprietary information”, including social security numbers, on unprotected, unencrypted Internet servers publicly accessible through a basic Internet search. The Commission clearly intended to send a message here: the fine was $10,000,000.In the Open Internet R&O, the FCC continues that trend by concluding that broadband Internet service providers are subject to the general privacy provisions of both Section 222(a) and (c). Having so concluded, however, the Commission recognizes that its current rules relative to CPNI protection are oriented to traditional telephone services, and not broadband access services. (The current rules, for example, require protection of “call detail information”, not a category of information normally associated with broadband access.) Furthermore, the current rules do not address many of the types of sensitive information to which a broadband service provider is likely to have access, such as a customer’s web browsing history. Accordingly, the FCC has decided to forbear from applying its existing rules to broadband access services.Of course, most broadband access providers are probably already paying attention to the need to protect their customers’ sensitive personal information. But now they will have to start paying attention to the way that the FCC will regulate their use, storage and destruction of that information. Expect the Commission to hold one or more workshops on this in the next few months; it will likely also issue a Notice of Proposed Rulemaking in the same time frame, aimed at developing a set of CPNI rules appropriately tailored for broadband access providers. Once such rules are adopted, we can expect the FCC to enforce them aggressively. As the FCC said in the R&O, it takes Section 222’s privacy mandate “seriously.”The FCC’s assumption of the role of enforcer of on-line privacy puts it somewhat at odds with the Federal Trade Commission. The FTC has for years been protecting consumers’ on-line privacy interests, primarily through its statutory authority to sue companies that engage in “unfair” or “deceptive” trade practices. The FTC has interpreted the notion of “unfair” or “deceptive” practices broadly to include negligent data storage practices, failure of companies to fulfill the terms of their on-line privacy policies, and allegedly deceptive offers of “unlimited” data plans.But the statute that gives the FTC the authority to do this clearly limits that authority in an important respect: common carriers subject to the Communications Act are exempt from FTC enforcement efforts relative to unfair or deceptive practices. As noted above, the FCC has now determined that broadband Internet access service providers are, in effect, common carriers under the Communications Act. Does that mean that the FTC is now barred from regulating such providers? Good question. (Note that, even if the FTC is indeed barred on that front, it can certainly continue to regulate the privacy practices of Internet content providers.)Previously, the FTC has stated its view that the common carrier exception is a narrow, “activity-based” exception that excludes only regulation of services subject to the Communications Act’s common carrier regulatory provisions, rather than a “status-based” exemption that excludes regulation of companies typically regulated by the FCC. But that distinction would not help the FTC here: the FCC has, in its Open Internet R&O, determined that the broadband Internet access “service” is subject to telecommunications (i.e., common carrier) regulation by the FCC.Presumably recognizing that its ability to act against broadband service providers may now have gone away, the FTC has lately emphasized that the FTC has always worked well with the FCC on issues of overlapping interest. Additionally, the FTC has floated recommendations that Congress delete the common carrier exemption. Still, unless the courts overturn the FCC’s reclassification of broadband access service, or Congress deletes the common carrier exemption, the FTC may be out of the business of enforcing privacy against broadband Internet access providers.So, a new level of complexity has been created regarding the federal regulation of on-line privacy issues. The FTC has been an aggressive regulator, with a couple of decades of experience in this arena, and it will still be able to regulate non-common carriers on-line. For its part, the FCC appears to be very eager to jump into the game, regardless of whether or not it must share jurisdiction with the FTC. Broadband Internet access providers would be wise to pay close attention to how the FCC interprets and applies its privacy mandates. The FCC’s approach may differ from the approach historically taken by the FTC – in which case, providers will have to make adjustments to their operations.Keep your eyes on CommLawBlog for further analyses of the FCC’s Open Internet R&O.

As we all know, last June the Commission adopted its massive Report and Order setting out the rules for implementation of the spectrum incentive auction. The auction, of course, is one element of a major reorganization of the spectrum in which (among other things) television stations will be “repacked” into a narrower portion of the spectrum. The repacking affects more than just TV licensees. Wireless microphones and other licensed low power auxiliary stations (LPASs) are allowed to operate on unused TV channels on a secondary, non-exclusive basis, so reduction in TV channels reduces LPAS opportunities as well -- a special problem for wireless microphone users in congested areas.Deep in the fine print of the magnum opus, the FCC – concerned about the impact that the re-pack will likely have on LPASs, and wireless microphones in particular – sought to ensure that LPAS licensees would have access to as many TV channels as possible post-repack.One way to achieve that was to permit LPAS operation co-channel with TV stations at distances less than those specified in Section 74.802(a) of the Commission’s rules, provided such use was coordinated in advance. To that end, Section 74.802(b) was revised to read:Low power auxiliary stations may operate closer to co-channel TV broadcast stations than the distances specified in paragraph (b)(1) of this section provided that their operations are coordinated with TV broadcast stations that could be affected by the low power auxiliary station operation. Coordination must be completed prior to operation of the low power auxiliary station.While portions of the incentive auction Report and Order became effective last October, the revised Section 74.802(b) did not because it had to be run through the Paperwork Reduction Act drill at the Office of Management and Budget. According to a notice published in the Federal Register. that process has been completed, OMB has given its thumbs up, and the revised Section 74.802(b) is effective as of April 1, 2015.

Coming soon: Innovative auction to dispose of innovative spectrum.The FCC has announced yet another spectrum auction. Ho-hum, right?WRONG – this isn’t like any previous auction.First, there’s the spectrum that’s up for bids. According to the FCC, bidders will be bidding on “newly-discovered” spectrum. It appears that the Commission has had a task force of its best engineers running elaborate tests at the Columbia, Maryland lab. Their quest: any and all spectrum that might have escaped everybody’s attention thus far.The effort appears to have paid off, in spades, with the first new spectrum unearthed since James Clark Maxwell predicted radio waves in 1867. “It must have been lying there the whole time,” said an FCC engineer who requested confidentiality. “We just happened to look in the right place.”Sources indicate that the spectrum about to make its debut is being referred to by FCC insiders as the “Bleen Band”, a tongue-in-cheek homage to social commentator George Carlin. The Commission is officially mum (apparently preferring to avoid rampant market speculation and potential legislative or judicial interference). But reports leaking from the Columbia lab say that Bleen Band spectrum has propagation characteristics ideal for a vast range of services, including broadcast, fixed and mobile wireless, radar, Wi-Fi, and those things that unlock your car from across the street. FCC sources say that signals on the Bleen Band “go forever”, “penetrate just about anything”, aren’t susceptible to any known atmospheric conditions, and require very little power.In the words of one knowledgeable Commission insider, it’s “like El Dorado, the Fountain of Youth, desktop fusion and a perpetual motion machine all rolled into one, with an antenna – and a small antenna at that.” Despite these rave reviews, though, don’t count on any pre-auction guarantees of performance from the FCC. According to more than one Commission rep (all speaking on condition of anonymity), the agency’s usual auction-related disclaimers (“The FCC makes no representations or warranties about the use of this spectrum for particular services, yada yada yada”) will apply, but “just to make the lawyers happy”.And how better to sell innovative spectrum than with an innovative auction format?While the precise details will be spelled out in a future public notice, the format looks to be even more innovative than the simultaneous “reverse/forward” approach in the works for the upcoming incentive auction. The hook this time? The Bleen Band will be auctioned pursuant to a “reverse blind” method.“Blind” auctions, of course, involve auctions in which sealed bids are submitted simultaneously so that no bidder knows what other bidders have offered. In the FCC’s “reverse blind” approach, bids will be universally available when they are made, but the precise nature and amount of the Bleen Band spectrum being bid on will not be disclosed to anyone (including bidders) prior to the completion of the auction. Recognizing that this might deter some bidders unsure whether the new spectrum will live up to its hype, the FCC plans to allow successful bidder(s) to craft their own service and licensing rules that will govern use of the spectrum acquired in the auction. Still open is the question whether the new net neutrality rules will apply to services offered over this spectrum.If you’re interested, you’d better get yourself up to speed fast. While specific dates have not yet been announced, the Commission has emphasized that the auction must be completed – and payments of all successful bids must be in the FCC’s hands – no later than September 30, 2015. Some sources, noting that September 30 is the last day of the federal government’s fiscal year, have suggested that the last-minute influx of cash may be needed to offset the unexpected (and unbudgeted-for) 2014 expense of hiring several thousand temporary staff persons to review, organize, digest and summarize each of the 4,000,000+ comments in the recent net neutrality proceeding.Happy April Fool’s Day!

Dramatic “optimizing” of FM antenna gets the hairy eyeball from the AudioDivisionIn the FM radio world, there are supposed to be only two kinds of antennas: directional and non-directional. While it has long recognized that that simplistic, idealized notion is not entirely valid, the Audio Division hasn’t acted on that recognition – until now.In a decision that likely disappointed at least one Texas FM licensee, the Division has ordered that licensee – whose station is licensed to operate, nondirectionally, with ERP of 100 kW – to explain why its license shouldn’t be changed to specify directional operation. Such a change would result in a reduction by more than half (from 25 kW to 9.1 kW) of the station’s transmitter output power.Non-directional antennas (a/k/a/ “non-D’s” or “omni’s”), of course, are supposed to transmit an equally strong signal in all directions. On the other hand, directionals – or “DA’s” – are designed to produce a signal that is stronger in some directions than others. They come in handy when a station needs to avoid interfering with a co- or adjacent-channel station in one direction.But things are not as simple as they might appear – mainly because, thanks to technical considerations, omni antennas do not necessarily provide an idealized circular signal contour. Perhaps most obviously, if a non-directional antenna is mounted on the side of a tower, rather than the top, the interaction of the signal with the tower structure itself can distort the signal in a number of ways. Recognizing this, antenna manufacturers have sought to adjust some omni’s to “optimize” their performance, i.e., to counteract such distorting effects.But once you start down the “optimization” road, things can leave the rails pretty quickly.After all, if you can adjust an omni’s performance in some regards, you can adjust it in others. And sure enough, for more than 30 years various efforts have been made to convert ostensibly omnidirectional antennas into de facto directional antennas through an array of devices. Those include use of frequency-matched “lambda” towers specifically designed to support an antenna operating on a particular frequency. The frequency matching effect of the tower can significantly alter an omni’s signal in various ways. Another device is the attachment of “parasitic elements” onto the antennas in various places. These, too, affect the signal.While such devices are usually touted as efforts to compensate for common distorting factors, observers have long understood that they may also be used to achieve favorable directionalization that can extend a station’s signal well beyond its predicted omnidirectional contour.The Commission was onto this back in 1984. It issued an obscure, one-page public notice (not published in any official publication, and not easy to track down in 2015 – until this post, at least), in which it warned:In making allotments and in issuing construction permits and licenses the Commission assumes that FM non-directional broadcast antennas have perfectly circular horizontal radiation patterns. Actual antenna patterns shall conform to the ideal as closely as is practicable. The use of any technique or means (including side mounting) which intentionally distorts the radiation pattern of what is nominally a non-directional antenna makes that antenna directional and it must be licensed as such.Having rattled that saber, though, the Commission carefully placed it back in its scabbard and locked it away, never to be wielded again. Until now.The Commission received a complaint from a Class A FM in Texas whose signal was, according to the complaint, getting creamed by a 100 kW Class C0 station. The C0 is an omni, and its predicted contour indicated that it was protecting the Class A as it should. But in real life, that wasn’t the case.The Division asked the Class C0 licensee about its transmission system and was told that the station’s antenna had been “optimized”, but not directionalized. Digging further, the Division determined that the C0’s signal in the direction of the Class A was the equivalent of a signal transmitted with between 260-275 kW of ERP, more than twice the C0’s authorized 100 kW ERP. Moreover, the maximum-to-minimum ratio for the supposed non-D antenna turned out to exceed the maximum value allowed for directionals in the horizontal plane. And there was evidence indicating that the directionalization was intentional: the antenna’s supporting structure was a lambda tower matched to the station’s frequency, and the licensee and its engineer had performed “pattern optimization” studies prior to construction. So the C0 licensee “knew in advance” how the antenna would perform.The Division’s understated conclusion: “[I]t is difficult to credit [the C0 licensee’s] position that its facility should be considered non-directional.”Since the Class A is entitled to the level of protection from the C0 predicted based on the C0’s supposed omnidirectional antenna, the Division has ordered the C0 to explain why its license shouldn’t be modified to specify the de facto directional antenna (or, more precisely, the directional pattern) which it’s using – but with power reduced to afford the Class A protection. As indicated above, such a major league reduction would be bad news of the C0.One take-home lesson from this order is that the FCC is prepared to help stations who believe that they are not getting the protection to which they are entitled as a result of another station’s “optimized” antenna.Exactly how many such situations exist, however, is far from clear. If a station had been experiencing such interference, it would presumably already have thrown the flag at the Commission. As a practical matter, it’s possible, if not likely, that lots of aggressively “optimized” antennas are currently in operation – but, since they aren’t causing interference, there’s probably not much chance that the FCC will start raising any questions about them.But the order provides another take-home message. It sends the unmistakable signal to anyone who might be thinking about installing an aggressively “optimized” antenna that care should be taken to avoid any interference to anyone as a result of the optimization.

FCC invites comments on proposal by coalition of nine radio licensees to shift sponsorship IDs primarily to InternetIn an unusual petition that was filed last November – but took five months to hit the FCC’s public radar screen – a group of radio station owners is asking the Commission to waive the sponsorship identification requirements for a “defined class of qualifying radio broadcasters”. While the prospects for a grant of the requested waiver may be limited (because it may be asking for something the FCC can’t provide), the fact of the request itself raises some interesting questions.The petitioners, who call themselves the Radio Broadcasters Coalition, consist of nine companies, including several major radio group owners – iHeart Media (née Clear Channel), Emmis, Cox, Entercom, Greater Media, among others. According to the FCC’s summary, they would like the Commission to let “radio broadcasters airing music or sports programming … provide information about sponsored material through a combination of less frequent on air announcements together with enhanced online disclosures.”Under the proposal, a qualifying radio station would, after a three-week “listener-education” period, have to make on-air sponsorship ID announcements only once each day (sometime between 6:00 a.m. and 7:00 p.m.), notifying listeners generally that (a) some programming on the station had been sponsored by certain identified sponsors and (b) listeners can find more details on the station’s website. At its website, each qualifying station would have a page, specifically accessible through a tab or link identified as “Enhanced Disclosure of Sponsored Programing”, containing “enhanced” sponsorship ID information. Such information would include a list of the names of sponsors, the names of the programs in which the sponsored material had aired, a list of the artists and music (or sports teams) affiliated with particular sponsor entities, and the types (but not amounts) of payments/services exchanged between sponsors and the station.In order to grant the request, the FCC would have to waive its sponsorship ID rule (Section 73.1212) and Section 317 of the Communications Act, both of which currently require that sponsorship ID announcements be aired “at the time” the sponsored matter is broadcast.In support of its proposal, the Coalition asserts that the waiver would allow the presentation of “far greater [sponsorship ID] information to consumers in a new, more detailed, and more easily accessible way.” That, in turn, would provide greater “protect[ion for] the public’s right to know the identity of sponsors by allowing enhanced sponsorship identification disclosures for [sponsored] programming through once-daily on-air announcements and online postings that together give listeners more sponsorship information than is currently available.” And listeners would also benefit from a “more satisfying listening experience … with fewer interruptions”.In effect, the Coalition would like permission to sell time on their stations (at least for music and sports programming), with the sponsors to be identified only once daily, and not necessarily in connection with programming they may have sponsored. Listeners would be directed to the station’s website, where “additional information” would be available. While it’s not entirely clear, it appears that that “additional information” might include, along with basic identification information, promotional information about the sponsors. In other words, the once-a-day broadcast announcements would simply encourage listeners to hop online to access advertising messages.An initial hurdle facing the proposal is the language of Section 317, which clearly mandates that sponsorship ID’s be aired “at the time of” the sponsored programming. Subsection 317(d) does afford the FCC discretion to waive that requirement “in any case or class of cases” if the public interest warrants. Waivers, of course, provide limited exceptions. In this case, the Coalition defines the supposedly limited “class” as all radio stations that (a) broadcast music and/or sports programming and (b) have a website. Since that “class” encompasses probably 80+% of all radio stations, it’s hard to see the request as anything more than an effort to write the rule out of the books by creating a nearly universal exception. That would be somewhat like waiving speed limits for all vehicles with at least four tires.Viewed in that light, the request doesn’t really look like the kind of thing contemplated by Subsection 317(d). But you never know. (The only historical 317(d) waivers cited by the Coalition as precedent for their request occurred about 50 years ago; the two cases cited seem a little dusty from non-use.)Another potential stumbling block: the Coalition’s justifications for the waiver seem less than compelling. The proposal would provide the listener “fewer interruptions”? While that’s undeniably true, Congress must have realized that the sponsorship ID requirement would result in “interruptions”, but it mandated it anyway. So – in a twist on our speed limit analogy – this rationale is somewhat equivalent to a request for the elimination of speed limits because drivers could then go faster. The Coalition also suggests that listeners will appreciate online access to sponsorship information because they might miss broadcast information if they happen to be listening while driving through a tunnel, or next to a honking horn in traffic. It’s a bit difficult to take that particular argument seriously.Much of the petition is devoted to the fact that the public is increasingly relying on the Internet for many things, as the Commission has repeatedly acknowledged. The sense of the petition is that advertisers and the consuming public alike view Internet advertising as preferable – so allowing broadcasters to shift their sponsorship messages would benefit both advertisers and consumers, while affording listeners a “more satisfying listening experience”. That may indeed be true, but it seems irrelevant to the sponsorship ID rule, which is aimed at insuring that listeners are told who is sponsoring programming they’re listening to while they’re listening to it.Although not mentioned in the Coalition’s petition, the proposal could conceivably be a response to continued efforts by record companies to make radio stations pay performance royalties for playing recorded music over-the-air. Congress has never provided for such royalties, mainly because it has perceived radio airplay as providing recording artists valuable exposure which compensates for the lack of performance royalties. But record companies and recording artists have persisted in seeking the amendment of the Copyright Act to guarantee them just such royalties.While stations may, of course, take money for the broadcast of particular records, such payments have to be acknowledged in contemporaneous sponsorship ID announcements – which discourages rampant “pay-for-play” arrangements. But as our colleague Peter Tannenwald proposed here several years ago, making pay-for-play a business strategy might offset the record companies’ proposed performance royalty. As Peter said in 2009: “Fix the sponsorship identification rule so that it becomes practical to comply with it, and then let the fur fly”. One way to do that could be what the Coalition is proposing. Their approach would presumably let stations take money for the playing of particular records as long as those arrangements are disclosed on the Internet. That would certainly facilitate increased pay-for-play deals, thereby affording broadcasters some protection against a performance royalty for sound recordings.As might be expected, some folks in the independent music and public interest communities haven’t reacted favorably to the Coalition’s petition. One organization called the petition a “big broadcaster bait-and-switch”. Another blogger said “Let’s not let the bastards get away with this” and called for readers to submit comments to the FCC opposing the waiver. It remains to be seen how influential these calls to arms will be. Interested parties have until April 13, 2015 to file comments and until May 12to file reply comments. Comments and replies may be filed through the FCC’s ECFS online filing system; refer to Proceeding No. 15-52.

Technical Content Alert!!! The rule changes discussed below are highly technical. If you’re OK with stuff like “attenuation [must be] greater than the attenuation at 1 kHz by at least: 60 log(f/3) decibels, where ‘f’ is the audio frequency in kHz”, you should have no problem. Others should proceed with caution.A couple of years ago we reported on a number of changes made by the FCC to its rules governing Travelers' Information Stations (TIS), the first changes to the TIS rules since TIS were established in 1977. Now those changes have been tweaked, although not as much as some might have liked.As noted above, the tweaks are highly technical, so much so that we won’t go into detail here. (There's a reason we chose law school rather than a career in engineering.) TIS cognoscenti should take a close look at the FCC’s decision for the real nitty-gritty. To summarize:The filtering requirement for TIS has been changed from 3 kHz to 5 kHz. The expectation is that this should improve the quality of TIS signals to match commercial AM station signals – but TIS operators who might prefer, for whatever reason, to continue to use 3 kHz filters may do so. (The Commission declined to eliminate the filtering requirement entirely.)The roll-off curve relative to signal attenuation has been adjusted in light of the changed filtering requirement.TIS audio filters may now be placed either ahead of the transmitter or between the modulation limiter and the modulated stage. Existing gear can be retrofitted by deactivating the old 3 kHz filter (which, under previous rules, had to be placed at the last stage of the audio chain) and adding an outboard 5 kHz filter at the transmitter audio input. Alternatively, manufacturers may redesign their gear to insert a 5 kHz in conformity with the revised rules.Manufacturers who retrofit their equipment will have to file a Class II permissive change request with the Commission for each model to be retrofitted. The request should list all filters to be used and provide “clear and concise” instructions for TIS operators who wish to perform the retrofit themselves. A licensee may retrofit its own system as long as the licensee has determined that (a) its equipment model has received a Class II permissive change grant and (b) only approved filters are used. Equipment newly designed in accordance with the revised filtering rules will need new FCC certification, as will use of an audio processor to perform the 5 kHz filtering (absent a dedicated 5 kHz filter).Did we mention that these are all highly technical?On the non-technical front, the Commission took this opportunity to underscore two separate limits relative to TIS program content.With respect to weather information, TIS operators are permitted to integrate into their feeds weather information, but only “during times of hazardous or potentially hazardous conditions”. A number of folks thought that it would be a good idea if TIS operators could include weather reports – such as routine NOAA weather broadcasts – into their programming. The Commission had previously rejected this notion, mainly because there are plenty of other available sources of normal, non-emergency weather reporting. However, the FCC has now observed that TIS licensees have “substantial discretion to determine what information is relevant to ‘hazardous or potentially hazardous conditions’ under the Commission’s rules”, which seems to provide some leeway on this front. The Comission helpfully offered the following non-exclusive list of conditions that might justify tapping into NOAA weathercasts: “snow, ice, mudslides, fog, flash floods, thunderstorms, wildfires, tornados and hurricanes”.And music lovers take note. Responding to anecdotal reports of TIS-transmitted music, the Commission reminded TIS licensees that “music content of any kind is not permitted”.

Apparently horrified by a three-second video clip inadvertently aired during newscast, FCC slams licensee with $325K fineIt’s been a while since we checked in on the FCC’s indecency policy. When last we did, the constitutionality of that policy remained unresolved (and, in the minds of at least two Supreme Court justices, seriously in doubt). And the FCC had cryptically announced that it had re-jiggered the policy in some undescribed way(s) that permitted the Commission to summarily dismiss (apparently in a matter of minutes, if not seconds) a million or more indecency complaints that had been sitting around for years. And the Media Bureau had invited comments on possible, unspecified, revisions to the policy.In other words, things on the indecency front seemed as muddied as ever.So it was something of a surprise to hear that the Commission had suddenly lowered the boom on a Roanoke, Virginia TV station, fining it the maximum – $325,000 – for a single three-second instance of alleged indecency, the broadcast of which, during a 2012 newscast, was admittedly unintended. It looks like the FCC wants to send a signal to broadcasters.The facts are relatively straightforward.During a 6:00 p.m. newscast, the station aired a report about the addition of a new volunteer to a local rescue squad. The focus of the report – one Tracy Rolan – happened to have starred in a long list of adult films, using “Harmony Rose” as her nom de filme. The hook of the piece was obvious: Porn star as local volunteer. Definitely an audience grabber.To open the story, the station used an image of Ms. Rolan/Rose – more precisely, her head and shoulders, and at least one of her fingers. (According to the FCC’s description, she is seen “moving [her finger] up and down on her tongue, with her lips partially open and then closing as she appears to suck on her finger.”). The image was obtained from the website of a distributor of Ms. Rolan/Rose’s films.Rather than use only her image, though, the station opted to display the entire webpage, which her image apparently dominated. But, as it turned out, the webpage contained additional imagery, including, along the right side of the screen, a number of “boxes” containing snippets from various films. One of those boxes included – for three seconds – the recognizable image of “a hand moving up and down the length of the shaft of the erect penis.”Ruh-roh.We can all safely assume that the broadcast depiction of actual sexual activity, up close and personal (and, apparently, unclothed), is likely to send the FCC into DEFCON 1. Anyone who airs such content must recognize the near certainty that the FCC, prodded by complainants, will come calling, and the end result is not likely to be pretty. And that’s what happened here. Complaints rolled in almost immediately, leading to a whopping fine.It’s easy to conclude, as the FCC has, that this particular broadcast can and should be punished, big time. Erect penises (and the manipulation thereof) are well outside the range of conventional prime-time acceptability.But before we jump on board the FCC’s bandwagon, let’s think about this for a minute.Exactly how the image of (in the FCC’s delicate words) “a naked, erect penis and sexual manipulation thereof” escaped the station’s attention is anybody’s guess. The guy who prepared the report advised that he “did not notice” the “small” video-laden boxes next to Ms. Rolan/Rose’s come hither image on the site. Since we don’t have a screengrab of the webpage he was looking at, we don’t know how credible that is – but let’s assume for the moment that the boxes really were relatively small and might thus have passed unnoticed (especially if the guy was focusing on the image he was looking for, i.e., that of Ms. Rolan/Rose). According to the station, the webpage – i.e., showing both Ms. Rolan/Rose and the boxes – was not fully visible on monitors in the station’s editing bay, so neither the News Director nor any other folks who reviewed the piece prior to broadcast saw the boxes.So it’s not unreasonable for the station to claim that it did not intend to broadcast the objectionable image. (The FCC does not dispute this.) And that image appeared on-screen for only three seconds, in the particular context of a newscast. While the FCC emphasized that those factors – newscast, inadvertence, brevity – did not warrant cutting the licensee any slack at all, its claims are not unassailable.On penalizing a station for material in its newscasts. The FCC states: “The Commission has repeatedly held that there is no exception from indecency laws for news broadcasts.” The licensee argued that the FCC hadn’t provided adequate notice as to what news programming, if any, might be subject to indecency considerations. In response, the FCC cites a 2006 decision in which the FCC did indeed say that “there is no outright news exemption from our indecency rules.” But, as in all things, context is important.The language quoted by the FCC comes from a reconsideration decision involving an incident in which, on a CBS news program, an interviewee had used the term “bullshitter” once. In its initial consideration of the facts (in March, 2006), the FCC characterized “the S-word” (including, presumably, any variants, like “bullshitter”) as “one of the most vulgar, graphic and explicit words … in the English language”, so much so that even a single use is “shocking and gratuitous”, “particularly during a morning news interview”. So CBS was guilty of broadcasting indecency (and profanity, too).On reconsideration eight months later, however, the Commission changed its tune: “[R]egardless of whether such language would be actionable in the context of an entertainment program, … the complained-of material is neither actionably indecent nor profane in this context [i.e., in the context of a news program].” In other words, use of “one of the most vulgar, graphic and explicit words”, a word guaranteed to shock and offend the audience with just a single appearance, was no longer indecent or profane thanks to the fact that it occurred in a newscast. In performing this U-turn, the Commission did profess not to be establishing an “outright news exemption” – but its action belied that claim.The Roanoke station could legitimately argue that it should be entitled to similar treatment. And while graphic images of sexual activity may be viewed as somehow more offensive than mere words, the Commission appears to have painted itself into a corner on that point by its extreme characterization of “shit” as extraordinarily “vulgar, graphic and explicit” and guaranteed to shock and offend. Having effectively declared “shit” to be the absolute height of indecency, and then having given CBS a pass on its broadcast of “bullshitter”, the Commission may be hard-pressed to explain why the same should not apply to other seemingly “vulgar, graphic and explicit” indecent content.On penalizing a station for a fleeting, three-second instance of alleged indecency.The FCC states: “[I]t was clear from Commission precedent that even brief displays of nudity could be actionably indecent.” Again, the alleged indecency in this case lasted three seconds. (Frame of reference: In Mark Ronson’s ubiquitous song “Uptown Funk”, the time it takes Bruno Mars to sing “Stop, wait a minute, fill my cup, put some liquor in it” is exactly three seconds.) That’s little more than the blink of an eye. To demonstrate that Commission precedent “clear[ly]” establishes that “brief” indecency may not be condoned, the best the Commission can do is cite a concurring opinion of Chief Justice Roberts with respect to a 2012 decision by the Supreme Court not to hear an appeal in the CBS/Janet Jackson case. With all due respect to the Commission (and to the Chief Justice), that is hardly persuasive, much less conclusive, authority. If the FCC really does have extensive “Commission precedent” on this point, it could and should have hauled it all out. The fact that it did not does nothing to shore up the Commission’s credibility on this point. (And, of course, let’s not forget that in recent years a number of judges have questioned the lawfulness of the FCC’s penalization of “fleeting” indecency – although its constitutionality has thus far escaped any conclusive judicial review.)On penalizing a station for theinadvertentbroadcast of alleged indecency. The FCC states: “Having made the choice to gather and display images from an adult film website as part of its newscast, WDJB is subject to sanction for its broadcast of actionably indecent sexual material without taking adequate precautions to avoid such result.” Granted, the station here was playing with fire when it decided to focus on an adult film actress. But it’s clear that the station did not intend to broadcast the penis-in-hand image as part of that story. Could the station have avoided this problem by being a bit more careful? Sure. But so could CBS when its interviewee (the subject of the 2006 decision mentioned above) used the grievous term “bullshitter”. No mention of “adequate precautions” was made back then: the Commission determined that no “actionable indecency” occurred even though a simple tape delay system could presumably have spared the audience exposure to the indelicate word.In the Notice of Apparent Liability addressed to the Roanoke station, the FCC cites no precedent in which it precisely spelled out the “adequate precautions” that the licensee should apparently have taken. The Commission does rely (in a footnote) on a sentence from its March, 2006 omnibus indecency decision. But that sentence says, in relevant part, only that licensees “will be held accountable for violating federal restrictions on the willful or repeated broadcast of obscene, indecent, or profane material”. Since the Roanoke station’s broadcast was neither intentional (i.e., willful) nor repeated, it’s not clear how quoting that sentence helps the Commission here.Nevertheless, the FCC concludes that the licensee acted “with reckless disregard for the content of its broadcast”. This is because the one guy didn’t happen to notice the allegedly indecent material, none of his superiors at the station caught it either, and the station’s editing equipment didn’t permit news personnel to make sure that the station’s audience wouldn’t be exposed to this kind of material. In the Commission’s view, that’s enough to transform the unintended broadcast into a “willful or repeated” violation worthy of a $325,000 fine. Some might view that as a stretch.The Roanoke licensee also argued that the fact that the FCC’s indecency policy is in flux made it difficult, if not impossible, to know what the standard was. In response, the FCC observes, correctly, that the announcement that changes to the policy might be under consideration wasn’t made until April, 2013, some nine months after the broadcast. Obviously, that announcement could not have affected the station’s July, 2012 decision to broadcast the Rolan/Rose piece. And anyway, the Commission piles on, the April, 2013 announcement made clear that, notwithstanding the possibility of a change in policy, the previously established policy would remain in effect for the time being.But wait. In that April, 2013 public notice, the Commission disclosed that, since September, 2012, it had been utilizing some alternate policy focusing strictly on “egregious” cases. And it had been applying that alternate policy to cases long pre-dating September, 2012, resulting in the summary dismissal of more than a million such cases. Since the FCC had not previously disposed of those cases – and, indeed, had in many instances declined to renew licenses because those cases were pending – the facts in each of them must have at least facially met the old standard of indecency. And yet, once the new “egregious” standard kicked in, out they all went. Doesn’t that indicate that, contrary to the FCC’s protestations, its policy had in fact changed in some respects? And if it changed, isn’t the Roanoke licensee entitled to know what the new policy is?The FCC would likely respond that the Rolan/Rose image would have been deemed “egregious” anyway. But the Commission has never described how its new “egregious” standard works in practice, nor has it explained how more than a million long-pending allegations of indecency happened not to satisfy the “egregious” standard. That being the case, how is the Roanoke licensee to know that it is not being arbitrarily singled out here?And then there’s the issue of the size of the fine.Under the Commission’s rules, the standard forfeiture for violation of the indecency rules is $7,000. But the FCC may “adjust” fines upward if it believes the circumstances so warrant. And, in the wake of the Janet Jackson incident, Congress authorized the FCC to whack broadcasters up to $325,000 for indecency violations. (That figure has since been upped to $375,000, but at the time of the Roanoke broadcast it was still $325K, so that’s the max that could be imposed here.)Starting with the $7,000 base fine, the FCC concludes that the “nature of the violation, and the Licensee’s degree of culpability and ability to pay” all justify a “significant upward adjustment”. Again, let’s bear in mind that the “nature of the violation” was an inadvertently broadcast, three-second image that was confined to a small “box” located along the side of a screen otherwise dominated by the finger-licking Ms. Rolan/Rose. And as far as “culpability” goes, the violation was admittedly unintentional; the licensee had been, at worst, merely reckless. Those factors don’t scream “We’ve got to throw the book at him”.As to ability to pay, the licensee happens to be a large entity owning a number of media interests. It could clearly afford more than $7K.Putting all these factors together, the Commission magically concludes that the appropriate upward adjustment happens to be a 46-fold increase. The FCC doesn’t explain the precise mathematics by which it arrives at the $325K mark. It’s probably a good guess that the Commission figured that, as long as Congress had given it fining authority up to that dollar value, the Commission might as well use all that authority.As mentioned above, the FCC seems to be trying to send some kind of signal to the broadcast industry here. The FCC obviously wants to remind us all that it can and will penalize fleeting, unintentional instances of arguable indecency, even when those instances occur during newscasts. And it wants to let everybody know that it can and will exercise its authority to dole out $325K+ fines.To be clear, this blogger is not advocating or defending the broadcast of graphic sexual activity (or any other programming, for that matter). But I am suggesting that any effort by the FCC to penalize any licensee because of the content of its broadcasts should be undertaken with extraordinary clarity and with extreme sensitivity to overriding First Amendment considerations. In view of the murky history of the FCC’s indecency policy, and the questionable constitutionality and somewhat chameleon-like nature of that policy, does it really make sense for the Commission to impose a maximum $325K penalty on a station guilty only of minor carelessness that led to an unintended, purely incidental, three-second miscue? If the Roanoke licensee chooses to fight the fine, we may find out.

New option allows filing of petitions for rulemaking through ECFS.If you’re planning on filing a petition for rulemaking with the FCC but you’re out of paper, or maybe your printer is low on toner and the local Kinko’s is closed, we’ve got good news for you. The Commission has announced that petitions for rulemaking may now be filed electronically!As we reported last December, the FCC has been tweaking its Electronic Comment Filing System (ECFS) to accommodate a wide range of electronic filings that previously could be filed only on paper. Thanks to those efforts, ECFS will now accept rulemaking petitions along with the other non-docketed filings we listed in our December post.The drill for petitions for rulemaking is essentially the same as for other non-docketed filings:

Frequent CommLawBlog contributor and copyright guru Kevin Goldberg (that's his smiling face next to the post) presented a 90-minute webinar on “Everything You Wanted (or Needed) to Know About Music Licensing, But Were Afraid to Ask” on March 25. Kevin covered the full landscape of licensing issues for broadcasters and webcasters – his PowerPoint was more than 75 pages long, for crying out loud (but trust us, as Kevin took us all through it, it was highly accessible).We promised all attendees that we’d be providing a link to the recording of the Swami’s show, and here it is. This will get you the audio and video. Even if you didn’t happen to be one of the lucky attendees, we welcome you to check it out (but you’ll have to register by providing your name and email address).Also, if you want a copy of the PowerPoint slides, you can access one here. It provides an excellent reference guide for anyone using music for broadcasting or webcasting.

FHH Profs Montero and Kirkpatrick show up-and-comers the ropes.Another class of the brightest and the best is working its way through the Broadcast Leadership Training Program, and FHH is there to help. The BLT, of course, is a 10-month Executive MBA-style program created by the National Association of Broadcasters Education Fund (NABEF) to provide rising executives the specific knowledge and skills they’ll need when it comes time for them to assess, buy, own and operate radio and television stations. The BLT provides “a blueprint for talented businesspeople to become a greater part of the industry and increase the diversity of voices available to the public”, according to the BLT website. (Check out this page of the website for information on how to apply for next year’s program; applications are due by May 31, 2015.)BLT participants don’t have to suffer through dry presentations offered by ivory-tower-cloistered lecturers. Au contraire, they are taught by a wide range of professionals who know what they’re talking about because they’ve experienced it all first hand – including (and here we’re quoting the BLT website) “leading communications attorneys”. So it should not surprise you that the most recent session,on “Closing on the Acquisition of a Broadcast Station”, was led by none other than FHH mavens (and CommLawBlog contributors) Frank Montero and Dan Kirkpatrick. Frank and Dan took their tutees through practical issues they’re likely to confront, including preparing closing documents, obtaining necessary consents, getting all financing in order, and the like.This year’s class includes: Anthony Arbucias, Graham “Skip” Dillard, Manny Fantis, Jacqué Freeman, Marlon George, Dustin Hall, Kelly Landeen, Sarah Miles, Brian Paul, Erica Pefferman, Claudia Puig, Mary Rogers, Deborah Salons, Ryanne Saucier, Scott Schurz, Matt Smith and Robert Yanez. They’re shown in the photo below, along with Michelle Duke (of the NABEF), DuJuan McCoy (an NAB Board Member and a BLT Trustee and alum), and Frank and Dan. That’s Frank on the right, giving the thumbs-up. But you don’t need his imprimatur to know that you’re dealing with the broadcast industry’s next generation of up-and-comers. You can tell that because they’re all sporting their CommLawBlog shades. (Don’t you wish you had your pair?)

Anti-SLAPP defense gets farther than expected, but fails in the end ... this time.In the continuing saga of Flo and Eddie vs. The Digital World, we have a twist. Sure, Flo and Eddie won again – it’s not that much of a twist. But the adversary this time – that would be Pandora – came up with a new response, and it didn’t go down without a fight.If you’re unfamiliar with the New Litigation Adventures of Older Rock and Rollers, check out my previous posts on the efforts of some , um, let’s just say “more mature” rock artists looking for royalties for the digital public performance of pre-1972 sound recordings. If you’re one of our regular readers, you’ll know that the score to this point is:Plaintiff Recording Artists or Record Labels: 3Defendant Sirius XM: 0The latest case pitted Pandora against Flo and Eddie, in front of U.S. District Judge Phillip Gutierrez in the Central District of California. Since F&E had already won one case in the same court before the same judge, Pandora was obviously looking at long odds. But that didn’t stop it from pulling out a couple of novel arguments.Its main argument was that Flo and Eddie’s lawsuit should be dismissed because it violated the California “Anti-SLAPP” Act. For those of you not in the know, in this context “SLAPP” stands for “Strategic Lawsuit Against Public Participation”. A “SLAPP” is a frivolous lawsuit filed simply to harass the defendant into silence or inaction. Such suits tend to be filed by “Big Guys” looking to squelch “Little Guys” unable or unwilling to go through the expense of a trial against deep-pocketed opponents. Example: a suit filed by Daniel Snyder, owner of Washington’s NFL franchise, against a local D.C. “alt-weekly” newspaper when the paper made fun of him.Recognizing the unfairness (not to mention obvious impropriety) of such things, almost 30 states have enacted “Anti-SLAPP” statutes looking to discourage SLAPP suits. They take various forms, but generally they permit a defendant to get a SLAPP suit dismissed early in the litigation process, thereby reducing the financial impact of having to take the case all the way through a trial. Some statutes even allow a successful defendant to recover damages, possibly even triple damages.Full disclosure: I’m on the board of a group called the “Public Participation Project”, a coalition of businesses and individuals working to pass federal and state anti-SLAPP legislation. It also seeks to educate the public regarding SLAPPs and the consequences of these types of destructive lawsuits. So I’m a fan of Anti-SLAPP arguments.But even I raised an eyebrow when Pandora invoked California’s Anti-SLAPP law.Turns out I was right: Judge Gutierrez rejected Pandora’s argument. But I was wrong because he found the argument a lot more credible than I’d foreseen.Resolving an Anti-SLAPP argument in California is a two-step process. The defendant claiming that a suit is SLAPP must first show that the defendant’s conduct – the conduct that is the target of the alleged SLAPP – was “in furtherance of the exercise of the constitutional right … of free speech in connection with a public issue or an issue of public interest.” If the defendant successfully meets that burden, Step Two kicks in: The case will be dismissed unless the plaintiff can come demonstrate that it will probably prevail on the merits.Pandora argued that it was exercising the constitutional right of streaming which, supposedly, is “a public issue or issue of public interest”. Flo and Eddie responded that streaming isn’t really a constitutional right when it involves infringement of copyright. But Judge Gutierrez agreed with Pandora: its streaming activity was “conduct in furtherance of Pandora's right to free speech in connection with an issue of public importance”. (Interestingly, on this point Flo and Eddie argued only that Pandora was not engaging in constitutionally protected conduct; they did not argue that the streaming of old music – their­ music – was not an “issue of public importance”. By arguing that the public interest is served because the playing of sound recordings is culturally valuable to society, Pandora effectively blocked any counter-argument from Flo and Eddie. What were they going to say in response – “no, you’re wrong, our songs are mindless drivel with no socially redeeming value or importance whatsoever”?)The first element of California’s Anti-SLAPP having been satisfied, the parties moved on to the question of the probability of Flo and Eddie’s success on the merits. Since they had already won a very similar case before Judge Gutierrez, Flo and Eddie’s chances looked good. But reaching into its bag of novel arguments, Pandora came up with perhaps the only argument available: that Judge Gutierrez’s earlier decision had been wrong.Pandora relied on a very complex argument. It involved a close reading of various California statutes, including particularly a section providing that, once a song is sold to the public, it is “published”, at which point state copyright protection ceases to exist because that is when the federal law recognized copyright protection in the given work. Judge Gutierrez somewhat succinctly summarized this argument as follows:Sound recordings were not afforded federal protection until the 1976 Copyright Act. Thus, Pandora explains that when The Turtles sold their recordings to the public in the 1960s, their California copyright protection expired and these sound recordings dropped into the public domain. Pandora does not limit its argument to public performance rights. When The Turtles placed an album on a music store shelf in the 1960s, the public could freely copy, distribute, and perform those sound recordings, so far as California copyright law was concerned.Not surprisingly, Judge Gutierrez wasn’t ready to conclude that he had been wrong, even if he hadn’t addressed this particular argument in his earlier decision. Looking at that argument now, though, he wasn’t impressed: “Pandora’s theory results in an impotent law that protects only the tiniest class of sound recordings.” Even Pandora itself could only “brainstorm” one example of an item that might fit in the “niche class” of pre-1972 recordings that might still be entitled to copyright protection: recordings of never-released historic live performances.” To Judge Gutierrez, it was impossible that the California legislature would have written its laws in a way that covered just this tiny sliver of the sound recording universe. Further, reading the law this way would ignore California’s “common law”, i.e., law derived from judicial precedents, which maintains property rights in these sound recordings.So change that “3-0” to “4-0” for Flo and Eddie. But maybe put an asterisk by the “4”, or at least just use a pencil, not a Sharpie. After all, Pandora still has two bites at the apple in this case alone. They have appealed the rejection of their Anti-SLAPP argument to the United States Court of Appeals for the Ninth Circuit; a decision there could be issued late this year or early 2016. And the proceedings before Judge Gutierrez will continue, where Pandora can file a “regular” motion to dismiss, raising more extensive or different arguments, to the extent any new legal theories or facts can be generated.As always, stay tuned.

245-page report takes no action, but suggests important changes to the music licensing processAlmost one year after launching a far-reaching inquiry into the “effectiveness of existing methods of licensing music”, the Copyright Office (CO) has released the 245-page report setting out its conclusions. Titled “Copyright and the Music Marketplace”, it doesn’t actually change anything – but it sets out a wide range of observations and recommendations that could resonate for years in Congress and elsewhere, possibly leading to major changes throughout the music licensing universe.I wrote about the CO’s initial two Notices of Inquiry last March and July. They posed 24 questions across eight different subjects relating to music licensing. The CO also held public roundtables in Nashville, Los Angeles and New York. It is therefore not surprising that the CO’s report is comprehensive. And here’s a surprise: Despite my earlier prediction that the CO’s eventual conclusions would likely be unfavorable for broadcasters, as it turns out several recommendations actually favor users of copyrighted music, including broadcasters. And to the extent that the CO is looking to a possible overhaul of pretty much all aspects of the licensing process, all participants in that process could end up benefiting from a less fragmented, more consistent system.But the report clearly urges Congress to move legislation that would create a performance right applicable to over-the-air broadcasting (though not exclusively), so one side of the industry is still likely to benefit more.Before delving into some of the details, we should probably note some general principles identified in the report. According to the CO, the study revealed broad consensus on four key principles:

With Auction 98 now in the works, the Commission has frozen, effective immediately (i.e., as of March 16, 2015):

The bidding won’t start until July, but there’s no time like the present to check out this year’s opportunities.The FM construction permits available in the 2015 auction have hit the show room floor. If you’re thinking about bidding on any of the 131 new and used models up for grabs, start looking now. The bidding action won’t start until July, but that doesn’t mean that it’s too early to formulate your game plan. This year’s listings include 113 brand new construction permits, seven used permits (i.e., permits that were sold once but never built) and 11 permits – including Muleshoe, Texas – that went unsold during the last auction.You can find a list of this year’s offerings here. As you peruse the list you’ll note that more than half (73 to be exact) are located in Texas. The remaining permits cover the map from New Hampshire to California and from Washington State to Georgia; there’s even a C2 up for grabs in Hawaii.As always, potential bidders should bear in mind that the FCC does not warranty what it sells. In fact, the FCC has included its standard four paragraph disclaimer, some in bold print, at page two of its notice. Among other tidbits, the Commission expressly disavows the useability of the CP’s on the auction block: “The FCC makes no representations or warranties about the use of this spectrum for particular services.” You have been warned.The range of starting prices for permits runs from the dirt cheap ($500 for any of three Texas permits) to the pricier, but still modest, $75,000 (for certain permits in Georgia, Utah, Missouri and, of course, Texas). If you spot a permit on the list that you think is overpriced, you can bring it to the FCC’s attention and request them to lower the price; that sometimes works. But even if it does, you should note that a lower starting price does not prevent the permit’s eventual price from skyrocketing. As in previous auctions, the FCC has no set maximum price for the licenses.If you would like to comment on the FCC’s prices or any other auction proposal, you have until April Fool’s Day – April 1, 2015 – to toss in your two cents’ worth. Reply comments are due by April 8, 2015. The FCC has created a special e-mail address – auction98@fcc.gov – to which comments or reply comments should be sent (in addition to the standard FCC filing procedures). Comments can also address the FCC’s proposed auction procedures, but the procedures described for the 2015 auction are pretty much the same as previous FM auctions. Still, true auction aficionados should take a close look at the fine print to make sure that they’re on top of the details.The usual bidding credit rules are set to apply this time around. Generally, a 35% bidding credit is available to bidders who own no other broadcast stations, and a 25% credit is given to bidders who own three or fewer stations (provided that none of those stations is in the same market as the target auction permit).Check back with CommLawBlog for updates.

Another federal agency is now considering regulation of drones - but it's NOT the FCC.We have previously reported on the FAA’s regulation – or non-regulation, or proposed regulation – of drones (official bureaucratic name: unmanned aircraft systems or UAS). Most recently, the FAA finally managed to issue a Notice of Proposed Rulemaking looking at operational rules for drones. Think maximum size and operating height, need for an operator license, requirement that line of sight be maintained – that sort of thing. (Since Congress told the FAA back in 2012 to get rules along these lines in place by 2015, the FAA seems to be a little slow out of the gate here, but that’s a story for another post.)Now a second federal agency is joining the move to regulate drones. The National Telecommunications and Information Administration (NTIA), which of late has been focusing mainly on policies related to broadband, spectrum use and the Internet, has begun a multistakeholder process to address “best practices” for the commercial and private use of drones. (Law enforcement and other noncommercial governmental drone use is not on the table here.) The goal is to look at broader drone-related issues, such as privacy concerns, transparency and accountability.The NTIA is following up on a Presidential Memorandum issued last February by President Obama. In that Memorandum the President pledged that the federal government “will take steps to ensure that the integration [of civil UAS into the national airspace system] takes into account not only our economic competitiveness and public safety, but also the privacy, civil rights, and civil liberties concerns these systems may raise.”An ambitious, if not narrowly-targeted, agenda. But the NTIA is nothing if not game, so to get the ball rolling it’s started off by posing a wide range of fairly open-ended questions covering three broad categories: privacy, transparency and accountability.Privacy interests are obviously implicated in drone operation because drones can go places that most of us can’t get to, and they can do it with a camera and GPS gear. The likelihood that drones could capture information – not just backyard nude sunbathing, but other activities that might normally be considered to be “private” – is clearly non-trivial. Other privacy concerns arise from proposals to use drones as a means of providing Internet service cheaply, particularly to remote areas. (Some drones can remain aloft over a relatively confined area for months.) With all that in mind, NTIA asks “what specific best practices would mitigate the most pressing privacy challenges while supporting innovation?”On the transparency side, NTIA thinks that it might be a good idea to be able to identify who’s operating which drones, and when, and what for, and what “data processes” are being used in connection with drone operation. That would make it easier to keep track of wayward, unsafely-operated or “nuisance”-causing drones. (NTIA does not, however, venture a definition of what a “nuisance” in this context might be, but we can all probably guess.) With all that in mind, NTIA is looking for suggestions for how to “promote transparent UAS operation”. Standardized physical markings or electronic identifiers are two possibilities it mentions. It’s also interested in how drone operators can most effectively alert the public to their operations.As to accountability, NTIA is looking at possible “accountability mechanisms” to keep drone operators honest. These could include things like: rules governing “oversight and privacy training for UAS pilots”; “policies for how companies and individuals operate UAS and handle data collected by UAS”; audits, assessments, and “internal or external reports” to verify UAS operators’ compliance with their privacy and transparency commitments. Those last items could, in NTIA’s view, possibly be handled by “companies, model aircraft clubs, UAS training programs, or others”.This is just a preliminary proceeding, characterized by the NTIA as a “request for public comment”. But it does provide all interested folks the opportunity to get in on the ground floor relative to any NTIA-based rules or policies that might eventually be developed. NTIA is looking for suggestions about possible “best practices” for ensuring safe, non-invasive drone use. If you’ve got any thoughts on that, you’ve got until 5:00 p.m. (ET) on April 20, 2015 to let the NTIA know about them.And one final note. We now have the FAA working on nitty-gritty operational rules, and the NTIA working on fuzzier (but nonetheless important) concepts of privacy, transparency and accountability. The one agency we haven’t heard from yet is the FCC.The expanding use of drones raises questions about the spectrum needs for both video transmissions and communications. As our friend Michael Marcus has commented a couple of times already – here and here, for example – drones’ reliance on spectrum could eventually spell trouble for Wi-Fi and cellular users. (You can read more of Dr. Marcus’s thoughts on this topic on his blog, which we recommend.) The prospect of more drones in the foreseeable future should prompt the FCC to try to get ahead of the curve.

Some familiar faces take an alternative approach to trying to get the FCC to open up spectrum for wireless broadband.Recently, we reported on bills introduced – actually, re-introduced, since proposals with the same language had died during the preceding Congressional session – by several reasonably high-profile Senators and Representatives. Their goal: requiring the FCC to study the possible use of the 5.9 GHz band for Wi-Fi use. Now the same crew is at it again, but they’re using a somewhat gentler approach. Rather than looking to require the Commission to do anything, this time they’re simply offering their support for the FCC’s efforts to “free up additional spectrum for wireless broadband use”. They don’t identify precisely which “efforts” they’re supporting, but they do happen to suggest that the Commission “explore potential sharing opportunities within the 10 GHz band”.While the letter doesn’t say how this Congressional team happened to hit on the 10 GHz band, we’re guessing it wasn’t an accident.As it turns out, back in May 2013, a company called Mimosa Networks filed a petition with the FCC asking it to start a rulemaking proceeding to make available additional spectrum for wireless broadband services. Where would that spectrum come from? Why, the 10.0-10.5 GHz band, of course. Mimosa suggested that additional spectrum is needed for wireless internet service providers (sometimes called “WISPs”) to provide long distance, high capacity links. These “backhaul” links form the middle portion of our internet connections, connecting points that collect “last mile” end user information to the Internet “backbone.” Backhaul is often transmitted over fiber (or legacy copper), but also it’s also transmitted wirelessly when the alternatives don’t make sense – for example, in rural areas, where wireless facilities are quicker and cheaper than fiber.In its petition Mimosa asks for a fairly aggressive power level (55 dBW). That’s based on similar power levels (specified in Part 101 of the rules) for operations in the 10.7-11.7 GHz band. Mimosa also helpfully suggests ways to mitigate interference to radar uses – specifically, a method referred to as Dynamic Frequency Selection, which means that, before transmitting, the broadband system would have to first listen for the signals from other users.The bad news for Mimosa is that the 10 GHz band is currently used by amateur radio (HAM) operators and amateur satellite services (amateur communications conducted via satellite). (It’s also used for both government and commercial radiolocation (a/k/a radar).) Longtime CommLawBlog readers will recall that amateur operators can be aggressive and persistent when it comes to protecting the spectrum turf they call home. Predictably, the amateurs opposed Mimosa’s proposal in full force. Whether or not as a result of that opposition, the Commission has taken no action on the proposal since the last comment was filed nine months ago.Against that backdrop, what should arrive but the recent letter to Chairman Wheeler from six members of Congress, encouraging the FCC to be sure to check out the 10 GHz band as a possible means of “expanding Wi-Fi capabilities to bring Internet access to more Americans.” (For the record, the letter was signed by Senators Booker and Rubio and Representatives Matsui, Guthrie, Eshoo and Latta.) While their letter falls short of the considerably more aggressive approach that these Congresspeople took with respect to the 5.9 GHz band – i.e., introducing legislation that would require the FCC should to consider Wi-Fi sharing in that band – nonetheless a pattern appears to be emerging: when the private sectors says that more spectrum is needed for Wi-Fi, Congress will come knocking on the FCC’s door if the FCC doesn’t move quickly enough. It remains to be seen exactly how the Commission will react to this unsolicited advice from Congress. Check back here for updates.

Next stop, some federal court of appeals?If you were looking for something to do in your spare time for the next several weeks, we have some good news for you. The FCC has just released its “Report and Order on Remand, Declaratory Ruling, and Order” in the net neutrality proceeding. While early predictions had put the page count north of 330 pages, the final item weighs in at a surprisingly trim 282 pages – if you don’t count the two appendices and separate statements from each of the five Commissioners, all of which bring the total page count up to an even 400 pages. (If you had 400 pages in your office pool, congratulations!) So if you want to get ahead of the curve, you’d better get reading ASAP. We recommend that, before you start, you stock up on your stimulant of choice – it’s likely to be a long haul.The rules adopted in the order won’t take effect until 60 days after the order makes it into the Federal Register, at the earliest. (Some of the new rules are “information collections” that will have to be run past the Office of Management and Budget for its OK first, which means that the effective date on those will likely lag behind the rest.) Also, for anybody who might be inclined to seek judicial review of this order – and, given the FCC’s 0-2 record in the D.C. Circuit so far, you’ve got to figure somebody’s going to – the 60-day period for filing your petition for review with the courts won’t start until Federal Register publication.Note also that this is one of those proceedings that could go to any of the U.S. Courts of Appeals. If petitions for review are filed in different circuits within the first ten days of the 60-day filing window, they will be subject to a lottery to see which circuit is the lucky circuit. In order to get your preferred circuit into the drum for the drawing, within 10 days of “release” of the order (i.e., Federal Register publication) you’ll have to (a) file your petition for review and (b) have a paper copy of the petition bearing the “received” stamp of the court delivered to the General Counsel’s office at the FCC. (Here’s a helpful guide about all this prepared by the FCC’s Office of General Counsel.)Check back here for updates.

Pushed by losses in the courts, FCC relies on Title II, Section 706, Title III as authority for increased regulatory control of the Internet[Blogmeister’s Note: While the FCC technically adopted its highly controversial “net neutrality” rules on February 26, the full text of those rules has yet to be released. We would have preferred to report on the actual rules, but since we don’t have them yet, we here in the CommLawBlog bunker present the following preliminary summary and analysis based onthe official public notice issued by the Commission on February 26(as well as the separate statements of the individual Commissioners). We plan to provide a detailed look at the rules and the accompanying Report and Order – said to exceed 300 pages in length – once they’re released.]First things first. The new rules did not spring out of thin air. They merely constitute the latest episode in a years-long, intensely scrutinized, highly charged process. That process has already involved two FCC attempts to craft “Open Internet” rules or policies, both of which were largely gutted by the U.S. Court of Appeals for the D.C. Circuit. (For a refresher course on the last decade or so of net neutrality back-and-forth, check out my post from last year.) The new rules are presumably designed to achieve the goals of the earlier, failed, efforts to promote net neutrality while avoiding the flaws perceived by the court.

Deep in the heart of Texas, Francisco Montero (we call him “Frank”), one of Fletcher Heald’s co-managing members, recently had the honor of interviewing Commissioner Mignon Clyburn at a joint session of the Radio Ink Hispanic Radio and Sports Radio Conferences. (You can read about the interview here.) Their tête-à-tête was just part of the festivities in Dallas, which included tours of the facilities of Dallas area Stations KXAS(TV)/KXTX(TV) and KUVN-TV/ KSTR-TV/ KUVN-CA. Commissioner Clyburn had expressed an interest in visiting a station while she was in Dallas and the gracious hosts of the tours, NBC/Telemundo and Univision, were more than happy to give the Commissioner an up-close-and-personal look at the inner workings of a couple of major market broadcast operations. Many thanks to NBC/Telemundo and Univision for their hospitality, and a big shout-out, too, to Oscar Rodriguez of the Texas Association of Broadcasters, who was essential to making it happen.

Last month we reported on a batch of FCC proposals aimed at liberalizing the rules governing operation in the 76-81 GHz band. The Notice of Proposed Rulemaking has now been published in the Federal Register, so we now know what the deadlines for comments and reply comments are. If you want to file comments, you’ve got until April 6, 2015; reply comments are due by April 20. Comments and replies may be filed through the FCC’s ECFS online filing system; refer to Proceeding Nos. 15-26, 11-90, 10-28 and 11-202.

As we reported late last year, a few of the FCC’s revisions to its rules concerning rural call completion had to be run past the Office of Management and Budget before they could take effect. According to a notice in the Federal Register, that process has now been completed, so the final elements of those rule revisions have taken effect as of March 4, 2015.

As we reported last month, the Commission has adopted a new set of E911 standards designed to improve E911 location capability. The FCC’s Fourth Report and Order setting forth those standards has now been published in the Federal Register. As a result, the new rules are set to take effect on April 3, 2015 … except for Sections 20.18(i)(2)(ii)(A) and (B); 20.18(i)(2)(iii); 20.18(i)(3)(i) and (ii); 20.18(i)(4)(i), (ii), (iii) and (iv); and 20.18(j)(2) and (3). Those all constitute “information collections” which, thanks to the hilariously named Paperwork Reduction Act, have to get the approval of the Office of Management and Budget before they can kick into gear. Check back here for updates as to those loose ends.

A couple of weeks ago we reported on a Notice of Proposed Rulemaking and Order (NPRM/O) that resolved some questions related to broadcast remote pickup (RPU) authorizations and proposed a number of changes to the RPU rules. (Among the proposals: allowing broadcasters to use digital technology for their RPUs.) The NPRM has now been published in the Federal Register, so we know that comments in response to the NPRM are due to be filed by April 3, 2015, and reply comments are due by April 20. Comments and replies may be filed through the FCC’s ECFS online filing system; refer to Proceeding No. 15-36.

Last month we reported on an FCC order implementing several rule changes dictated by Congress in the STELA Reauthorization Act of 2014. Those changes include the ban on joint negotiation for retransmission consent agreements by any two same-market TV stations not under common control (as that term is defined by the FCC rules). The Commission’s order has now been published in the Federal Register, so we can tell you when the revised rules will take effect. The magic date: April 2, 2015. Mark your calendars.

New bills would force the FCC to examine, on an expedited basis, possible Wi-Fi and other unlicensed use of 5.9 GHz band.As a general rule, the FCC is in the driver’s seat when it comes to spectrum management in the U.S. But that doesn’t mean that Congress can’t, and won’t, occasionally engage in some aggressive backseat driving. And so it is that several members of Congress have reintroduced legislation – S.424 in the Senate, H.R.821 in the House – strongly suggesting the direction the FCC should take with respect to the 5.9 GHz band (i.e., 5860-5925 MHz). The bills would require the FCC to “provide additional unlicensed spectrum in the [5.9 GHz band] under technical rules suitable for the widespread commercial development of unlicensed operations in the band”, provided that the Commission first determines that such use won’t cause harmful interference to existing licensees of that band. The bills also provide detailed specifications, and an accelerated timetable, governing how the FCC must make that determination.If this sounds familiar, that’s probably because an essentially identical proposal was introduced last year. No action was taken on it then, so it’s been reintroduced.Under the detailed schedule set out in the bills, the FCC would have to:

TVMLC settlement with SESAC gets the thumbs up from judge; important forms to be sent to participating stations to get the refund process rollingIf you’re a full-power TV operator in the U.S. (or its territories) and you obtained a performance license from SESAC any time after January 1, 2008, make sure you keep an eye out for a form you’re likely to receive from the Television Music License Committee (TVMLC) or its attorneys entitled “Settlement Antitrust Class Action Settlement Refund Payments.”Fill it out, return it, pass GO, collect much more than $200 and roll again. (Note: Stations own or operated by Univision or Telefutura (now UniMas) or any station that opted out of the settlement don’t qualify. We suspect that you know who you are.)The settlement in question resolves claims made by the TVMLC against SESAC. I’ve already written in considerable detail about the settlement itself, so if you’re at all hazy on the details, take a look at my earlier post. As I reported last November, the TVMLC and SESAC had reached a settlement agreement and submitted it to Judge Paul A. Engelmayer, the federal judge presiding over the case.The mere fact that the parties had resolved their differences was not the end of the story; the judge had to sign off on the deal, too. So a court-issued Notice was circulated giving any malcontents the right to protest the settlement terms or opt out. This was followed by a hearing held on February 18, 2015 – and one day later Judge Engelmayer sealed the deal in an Opinion and Order. With that, if you’re a qualifying station, the money will now start coming your way once TVMLC crunches some numbers.The bulk of the Opinion and Order is legal mumbo jumbo addressing certain necessary issues, like whether the class was properly certified (it was), whether the settlement was “fair, adequate, and reasonable, and not a product of collusion” (no problem there, either), whether the plan of allocation was also “fair and adequate” (yup), and whether the contemplated attorney’s fees and costs make sense (they do).But really, most affected TV licensees are probably far more interested in another set of questions, like:Who gets paid? Any full power television station in the United States or its territories who obtained a performance license from SESAC at any time after January 1, 2008, unlessthe station is owned and operated by the Univision or Telefutura (now UniMas) networks or the station opted out of the settlement.What do they get? Each qualifying party will get its pro rata share of a total pay-out pool of $42.5 million fund. That figure represents “the alleged artificially inflated license fees paid to SESAC since 2008 as a result of the alleged anti-competitive conduct”. (To be completely accurate, the $42.5M represents about 73% of the overall damages to be paid by SESAC; the rest is going elsewhere – you know that the lawyers have to get their cut.)When will they get it? While the settlement has been approved, it’s still going to take some months to get the money flowing. The “plan of allocation” requires that the TVMLC determine, first, the total license fees paid by each individual station to SESAC between 2008 and 2013 and paid or payable to SESAC for 2014, and second, each station’s pro rata share of the total license fees, paid or payable to SESAC during these period. The TVMLC will then distribute to station owners. If more than 1% of the total settlement fund is left over after the first distribution, lather, rinse and repeat. (On the off-chance that either of the first two distributions leaves funds amounting to 1% or less of the settlement, that residue stays with the TVMLC. )This process is supposed to start within 60 days. It will kick off with the TVMLC reaching out to stations to gather the preliminary information from which to do the necessary calculations. Again, television stations should keep their eyes out for a document entitled “Settlement Antitrust Class Action Settlement Refund Payments.”The form allows participating stations to tell the TVMLC who to write the check to, so it needs to be dealt with … and fast – the completed form is supposed to be returned within 10 days after it’s sent out to the stations.

We recently reported on the FCC’s proposal to revise its broadcast ownership reporting requirements to permit all attributable interest holders to utilize a “Restricted Use FCC Registration Number” (RUFRN) in connection with both commercial and noncommercial broadcast ownership reports (FCC Forms 323 and 323-E, respectively). The RUFRN would largely replace the Special Use FRN which the Commission invented in 2009-2010 when its initial plan – which would have required all individuals listed in commercial ownership reports to identify themselves with Social Security Number-based FRNs – ran into some rough sledding. The Notice of Proposed Rulemaking has now been published in the Federal Register, which triggers the deadlines for comments and replies. If you are itching to file comments, you’ve got until March 30, 2015; replies may be filed by April 13. Comments and replies may be filed through the FCC’s ECFS online filing system; refer to Proceeding Nos. 07-294 and 10-234.

Last week we reported on a Notice of Proposed Rulemaking (NPRM) issued by the Federal Aviation Administration relative to the operation of “Unmanned Aircraft Systems” – what the rest of us out here in the Real World would refer to as “drones”. The NPRM has now made it into the Federal Register, so we know that comments in response to the NPRM are due by April 24, 2015.

After nearly a decade, the FAA advises that it is no longer pursuing a proposal that would have inserted it deeply into the regulation of FM stations.For years, the Federal Aviation Administration has toyed with the idea of regulating use of some portions of the spectrum – including particularly the FM band (approximately 88 MHz–108 MHz) – even though conventional wisdom says that such matters are statutorily (not to mention logically) controlled by the Federal Communications Commission. The FAA backed down from these aspirations to some degree in 2010, but in doing so it sniffed, in effect, that we all hadn’t heard the last from it on this point.Now, five years later, the FAA appears to have thrown in the towel. In a three-sentence letter to the FCC’s Office of Engineering and Technology, the FAA has advised that it is “no longer pursuing the proposed frequency notification requirements for FM radio stations” which it has long had its regulatory eye on.Ideally, this means that the FAA has finally abandoned any hope of affirmatively regulating FM radio transmission facilities.In fairness, the FAA’s interest in that particular chunk of the spectrum is not by any means crazy. Modern aviation systems – both on-board aircraft and on the ground, particularly in the vicinity of airports – use radio spectrum for a variety of important purposes, including communications and navigation. As it turns out, the FM band bumps up against aeronautical frequencies: it’s immediately adjacent to a band (108-137 MHz) used by the FAA. Since FM stations generally operate at power levels far greater than FAA equipment, the chances that FM stations might cause electromagnetic interference to nearby FAA facilities are not trivial. The result could be inaccurate navigational guidance to the pilot – showing the aircraft to be on course when it’s not – or interference to air-to-ground communications. We can all agree that such results are best avoided.The FAA for decades sought to insert itself into the process of authorizing broadcast stations, primarily through its acknowledged control over towers near airports. This led to considerable tension with the FCC and many broadcasters (as well as other spectrum users). It’s one thing for the FAA to regulate the height of towers and other structures that might get in the way of aircraft landing and taking off. It’s another for the FAA to assert that it can or should dictate the geographical areas in which certain radio frequencies may be operated.In 2006 the FAA opened its own proceeding looking to expand its regulatory control over spectrum use. It wanted to require, as part of its Determination of No Hazard process, notice of most any change to any station operating on a wide range of frequencies. New or modified structures that would hold RF generators using those frequencies, changes in channels, power increases of 3 dB or more, antenna modifications, etc., etc. – everything would have to go through the FAA first for its blessing. And without that blessing (in the form of a Determination of No Hazard), the change would not be permitted.The potential for bureaucratic delays was huge, as was the potential for inter-agency confusion and inconsistency.In 2010, the FAA decided that it wouldn’t pursue its proposed changes, so it withdrew the proposal for required pre-construction notice for all frequencies other than the FM band (88.0-107.9 MHz). The question of FM spectrum was left open, to be resolved amicably by the FAA and the FCC. The FAA indicated that it would deal with that question “when a formal and collaborative decision [between the FAA and the FCC] is announced.”No such “formal and collaborative decision” has been announced in the intervening five years, which would suggest that the matter has since remained under discussion. Indeed, in a 2012 Notice of Proposed Rulemaking and Order, the Commission expressed “concern” that the issue remained unresolved. Partly in response to the FCC’s concern – albeit three years after that concern was expressed – the FAA has now tersely but explicitly stated, without elaboration, that “the FAA is no longer pursuing the proposed frequency notification requirements for FM radio stations operating in the 88.0-108 MHz frequency” associated with its 2006 rulemaking.If true, that would mark the end of the protracted turf battle between the FAA and the FCC. We add the “if true” qualifier because we’re not aware of any “formal and collaborative decision” between the two agencies having been announced. The FAA’s letter provides no supporting citation to any particular order (or other document) in which the FAA might have unilaterally reached this decision. A search of the FAA’s website turned up no evidence of any such formal, unilateral decision on the FAA’s part.Still, we do have the FAA’s recent letter, which says what it says. That’s at least something.

VerStandig lawsuit tossed on technicalities.Will geofencing really provide webcasting broadcasters a shield that they can deploy against royalty claims? While that question was raised in a lawsuit last spring, it won’t be getting answered soon: the case has been dismissed … for the time being, at least. Thanks to considerations that many may view as “technicalities”, U.S. District Judge Michael F. Urbanski tossed the suit filed last April by Verstandig Broadcasting. But he did so “without prejudice”, meaning that the core question remains unanswered and may still be raised, and resolved, in a later suit.As we have previously reported, “geofencing” is a technology that, in theory, permits a webcaster to limit access to its programming based on the physical location of the computers receiving the webcast. It works by checking the “receiving computer’s IP address, WiFi and GSM access point, GPS coordinates, or some combination against a real world map of those virtual addresses”.Why would that give a webcasting broadcaster a way around webcaster royalties?Because of Section 114 of the Copyright Act. That section provides a limited exemption from performance royalties arising from the digital transmission of sound recordings. While broadcasters are exempt from performance royalties for their broadcast programming, they’re still on the hook for royalties for recorded performances that they retransmit on the Internet, i.e., digitally. But thanks to Section 114(d)(1)(B)(i), broadcasters are exempt from performance royalties for digital retransmissions of their broadcast signals as long as those retransmissions don’t go “more than a radius of 150 miles from the site of the radio broadcast transmitter”.Historically, many – probably most – folks figured that that 150-mile exemption applied only to what we may think of as conventional “retransmission” mechanisms: retransmission of broadcast signals by a cable system or an over-the-air translator or booster. But, VerStandig reasoned, if a radio station’s webcast signal can be prevented from reaching listeners beyond 150 miles of the station’s transmitter, why shouldn’t the royalty exemption apply there as well? Not necessarily a bad argument.But, as it turned out, VerStandig aimed its lawsuit at the wrong target and pulled the trigger a bit too soon.In asking for a court order confirming its reading of Section 114, VerStandig named SoundExchange as the sole defendant. It presumably reasoned that SoundExchange, which serves as the collection agent for webcasting copyright royalties, would be an appropriate target. It reasoned wrong, at least as far as Judge Urbanski was concerned.In Urbanski’s view, VerStandig was looking for a ruling protecting it from claims of copyright infringement. Such claims may be brought only by copyright holders, not by SoundExchange, which is merely the copyright holders’ agent for collection purposes. So VerStandig should (in the Judge’s view) have sued not SoundExchange, but one or more copyright holders in a position to sue VerStandig for infringement. Since SoundExchange was the only named defendant, Urbanski concluded that he could not in any event provide the relief sought by VerStandig.Moreover, VerStandig hadn’t even deployed geofencing technology, so it couldn’t demonstrate that that technology would in fact prevent its digital stream from being received beyond the 150-mile perimeter. VerStandig did have a bunch of experts who claimed that it would work but, in the Judge’s view, VerStandig had “done little or nothing to demonstrate that geofencing is anything more than a pipe dream.”Constitutionally, federal courts have the authority to decide matters only when there is some actual “case or controversy”. That normally requires that there be some concrete, definite, immediate dispute between the parties before the court. Here, Judge Urbanski concluded that there was no real dispute between VerStandig and SoundExchange. And he further concluded that the basis for VerStandig’s claim – i.e., that geofencing would keep the digital signal within 150 miles of the transmitter – was far from established. In other words, as presented by VerStandig, this lawsuit did not pose a “case or controversy”, and it had to be dismissed.Fans of geofencing shouldn’t view this as a final defeat by any means. Urbanski’s decision clearly leaves the door wide open for another case – maybe even filed by VerStandig – directed against a proper defendant and supported by a more persuasive showing relative to the effectiveness of geofencing. Will some broadcaster take this up (possibly with the assistance of geofencing suppliers, who might consider providing their gear at a deep discount to a broadcaster willing to fight the fight)? And if some such lawsuit gets filed and the concept of a geofencing-base exemption gets traction, will Congress be inclined to step in to eliminate that notion? We’ll keep an eye on things. Check back here for updates.

Spoofing tactic appears to backfire on robocaller.As a public service, we offer a couple of helpful CommLawBlog tips to folks who feel like violating the Telephone Consumer Protection Act (TCPA) by making unsolicited prerecorded advertising calls:

Commission proposes technical adjustments to help remote pickup operations enter the digital age.It looks like broadcasters’ Remote Pickup (RPU) operations may finally be getting pushed into the digital 21st Century. In response to separate petitions filed by the Society of Broadcast Engineers (SBE) and the Engineers for the Integrity of Broadcast Auxiliary Services Spectrum (EIBASS), the Commission has issued a Notice of Proposed Rulemaking and Order (NPRM/O) resolving a couple of RPU-related questions and proposing a number of changes to the RPU rules.An RPU, of course, is one type of Broadcast Auxiliary Station. RPUs are used to send program-related information – including programming – from remote sites back to the station or network. They operate in one of three bands which are either shared with PrivateLand Mobile Radio Services (PLMRS) or close to PLMRS frequencies. Back in 2002 the Commission took steps to “harmonize” RPU standards and PLMRS standards in the hope that broadcasters would use PLMRS gear, which tends to be more spectrum efficient (largely because PLMRS gear is digital).But that hope has been frustrated by a couple of practical problems.For example, PLMRS operations – walkie-talkies, vehicle dispatch, two-way communications, etc. – use narrowband transmission and, therefore, don’t provide the higher audio quality (with no delay) that broadcasters need for audio program feeds.No problem. The Commission concluded in 2002 that broadcasters could combine, or “stack”, the narrower channel segments to create wider band segments more suitable for their purposes. But that proved to be a less than ideal solution: The RPU rules require that RPU licenses specify the “channel center” on which the station will operate, and when you stack an even number of channel segments the “center” of the resulting stack does not match up with any of the center frequencies specified in the RPU rules. According to both SBE and EIBASS, this anomaly has discouraged broadcasters from using stacked segments; each offered suggestions for clearing up the anomaly.As far as the Commission is concerned, though, no change is necessary because the rules already address the stacking of even numbers of channel segments: in such situations, the applicant merely specifies a center channel which is half-way between the lowest and highest frequencies in the stack. Problem solved.SBE also noted that the determination of center channel can result in a frequency specified out to six decimal places, e.g., 455.496875 MHz, a degree of precision not easily achievable with most analog equipment. The Commission addresses that concern by observing that, as long as the broadcaster complies with applicable emission masks and programs its center frequency as closely to the specified center frequency as the equipment will allow, that will be deemed to be in compliance.Another factor may have discouraged broadcaster use of PLMRS equipment: under the FCC’s rules, RPU operation must be in analog, not digital, mode. But most PLMRS gear is designed for digital use. Both EIBASS and SBE urged that the analog limitation on RPUs be tossed so that RPUs could use any form of digital modulation (as long as the broadcaster complies with the applicable emission mask and bandwidth emission requirements). The Commission is on board with that suggestion, and is now seeking comment on how best to implement it.SBE also asked for an interim blanket waiver to permit all RPUs operating in the VHF or UHF bands to operate digitally using FCC-certified narrowband RPU equipment right away. The Commission wasn’t willing to go that far, however. Until various questions concerning digital RPU operation are resolved in this proceeding, the FCC is reluctant to jump the gun and permit such operation industry-wide. (One open question: Digital RPU operation would also require changes to the station identification requirements; the Commission is looking for comments on how best to handle that. Another open question: Should digital use be permitted in the HF RPU band?)And finally, the FCC agrees with SBE’s observation that the need for 100 kHz RPU channels is a thing of the past. Accordingly, it proposes to eliminate such channels in the future. Existing authorizations for 100 kHz channels would be grandfathered indefinitely, and new such authorizations might be issued on a case-by-case waiver basis.Deadlines for comments and reply comments in response to the NPRM/O have not yet been announced. Check back here for updates.

At Congress’s direction, FCC narrows, considerably, the ability of same-market stations to negotiate retransmission consent deals jointly.Back in November (as we reported), Congress passed the STELA Reauthorization Act of 2014 (a/k/a STELAR). Among other things STELAR required the Commission to modify certain rules to implement a number of Congressionally-dictated changes. STELAR also required that those modifications take effect pronto – some within 90 days, others within nine months of STELAR’s enactment. Obviously mindful of both the chores Congress assigned it and the limited time frame provided by Congress to get those chores done, the Commission has taken the first step in that direction, releasing an Order amending its rules to incorporate four STELAR-mandated provisions. The four provisions address sunset dates, the ban on joint retransmission consent negotiations, expanded protections for significantly viewed stations and elimination of the “sweeps prohibition.”Don’t be fooled by its meager five-page length and ostensibly limited scope: the Order will undoubtedly have far-reaching impact.First, and most straightforwardly, the sunset dates for certain retransmission consent rules have been extended five years. The rules – previously set to expire December 31, 2014 or January 1, 2015 – will now expire December 31, 2019 or January 1, 2020, respectively. The rules involve: the retransmission consent exemption for carriage of distant network signals by satellite carriers; the prohibition on exclusive retransmission consent contracts; and the expiration of the reciprocal good faith negotiation requirements.Second, and perhaps most importantly, the Order implements the STELAR-dictated ban on joint negotiation by broadcasters in retransmission consent. As readers will recall, earlier in 2014 the Commission had adopted its own joint negotiation prohibition. But, as called for by the Commission, that prohibition applied only to Top-Four-ranked stations, in the same market, that did not share some common attributable ownership (as measured by the Commission’s ownership rules). Under STELAR, that joint prohibition has been expanded to bar joint negotiations between any two same-market TV stations not under common de jure control. Concluding that this STELAR-mandated version is in all ways broader than its existing prohibition, the Commission has now simply incorporated the STELAR language almost verbatim into the rules.The Commission does clarify one perhaps somewhat overlooked aspect of STELAR: where the original, FCC-designed joint negotiation prohibition did not apply to any stations that shared common attributable ownership, that exemption has now been narrowed to apply only to stations that are actually under common de jure control. So where, prior to STELAR, two Top-Four-ranked same-market licensees with at least some common ownership could still engage in joint retrans negotiations, under the STELAR-imposed standard such joint negotiations involving two same-market stations (regardless of whether they are Top-Four-ranked) are permitted only if the two licensees are under common de jure control.Third, the Commission has incorporated into its rules a prohibition barring a television station from preventing an MVPD, by contract or otherwise, from importing a distant signal if that signal qualifies as “significantly viewed” or if the MVPD is otherwise legally authorized to import the signal.Finally, the Order removes the long-standing “sweeps prohibition” from the Commission’s rules. This provision has long prohibited a cable MVPD (although not a satellite operator) from deleting a station’s signal during a Nielsen “sweeps” period.Attentive readers might question why the Commission has adopted these rule changes without first undertaking the conventional notice-and-comment rulemaking proceeding. Such proceedings are ordinarily required by the Administrative Procedure Act. But that Act exempts situations in which the FCC determines that such a proceeding is unnecessary. In this case, Congress explicitly dictated the rule changes to be made, including the narrowing of the joint retrans negotiation prohibition. Since Congress is the FCC’s boss, the Commission’s got to follow Congress’s direction. Accordingly, the Commission had no choice but to adopt those changes, so it concluded that no public notice and comment proceeding was required.Barring court challenge or reconsideration, these four provisions will take effect 30 days after the Order is published in the Federal Register. Check back here for updates.

Attention LPTV, Class A TV and TV Translator CP and license applicants: Form 2100 is your ONLY option as of February 23.Last September we introduced our readers to the new “Licensing and Management System” (LMS) that the Commission plans to use as a one-stop-shop for all broadcast forms. Once LMS is fully operational, our old friend the Consolidated Database System (CDBS) will be put out to pasture. (Before you think about cheering for the demise of CDBS, you might want to take Form 2100 out for a test spin - CDBS may be a devil, but it's the devil we know.)As we previously reported, in LMS all the various broadcast applications and forms which have traditionally been identified by separate numbers will now all have a common form number, Form 2100, but will be identified as separate “schedules” to that form. So, for example, where a full-power TV construction permit applicant used to have to file Form 301 in CDBS, in LMS the applicant will file Form 2100, including Schedule A. Full-service TV license applicants used to have to file Form 302-DT; in LMS they’ll file Form 2100, including Schedule B.As initially rolled out last fall, LMS offered only Schedules A and B. But progress is clearly being made on the LMS front: a recent public notice advises that four more schedules (Schedules C, D, E and F) have now been added to the Form 2100 options.The new schedules are to be used by Class A, LPTV and TV Translator applicants for the following purposes:Schedule C – Obtaining a construction permit for an LPTV or TV Translator station. This replaces Form 346.Schedule D – Obtaining a license to cover an LPTV or TV Translator station. This replaces Form 347.Schedule E – Obtaining a construction permit for a Class A TV station. This replaces Form 301-CA.Schedule F – Obtaining a license to cover a Class A TV construction permit. This replaces Form 302-CA.And heads up, if you’re a Class A, LPTV or TV Translator applicant and you’re planning on filing for a CP or covering license, you’re going to have to use Form 2100 and the appropriate schedule as of February 23, 2015.

Prudent network management or Wi-Fi jamming? The question has been taken off the table … for now.Last year we reported on a couple of interactions between the FCC and the well-known hotelier, the Marriott Corporation. The news started inauspiciously for Marriott when the Commission wrapped up an investigation (started in 2013) by spanking Marriott with a $600,000 civil penalty. The FCC determined that Marriott had used “containment capability” to prevent guests at the Gaylord Opryland (run by Marriott) from by-passing the hotel’s Wi-Fi system in favor of their own DIY hotspots.Presumably prodded by that investigation, Marriott (joined by some hotel friends) filed a request for declaratory ruling (or, in the alternative, for rulemaking), essentially asking for a determination that what Marriott had done really was OK. (Specifically, Marriott was asking the Commission to hold that a network operator may “mitigate” threats to the operator’s network, even when doing so results in interference to guests’ WiFi hotspots.)The FCC dutifully announced the filing of the request for declaratory ruling and invited comments about it. But a month later, it also issued an “Enforcement Advisory” alerting one and all to the fact that preventing one’s Wi-Fi enabled devices from connecting to the Internet constitutes prohibited “jamming”. And a month later, out came another “Enforcement Advisory”. This one was even more pointed. Referring to “a disturbing trend in which hotels and other commercial establishments block wireless consumers from using their own personal Wi-Fi hotspots on the commercial establishment’s premises”, the advisory declared flatly that “Wi-Fi blocking violates Section 333 of the Communications Act, as amended.”Not surprisingly, Marriott (and the other requesters) have now withdrawn their request for declaratory ruling (and the FCC has lost no time in officially bidding it adieu).In their withdrawal letter, Marriott et al. strongly deny the Commission’s claim that hotels intentionally messed with private Wi-Fi hotspots in order to force consumers to use the hotels’ pricier Wi-Fi network. And they also note that no less an authority than the Department of Homeland Security, in conjunction with other federal agencies, had issued a technical reference in which it (a) “require[d] that internal WLANs operated by federal agencies use wireless intrusion detection and prevention systems” and (b) recommended the use of such systems by authorized visitor WLANs.” In other words, in Marriott’s view it was merely implementing cautious guidance from DHS, not illegally jamming anything.Still, the handwriting on the Portals walls was pretty darn clear, particularly in the most recent “Enforcement Advisory”. So rather than expect that the FCC might be persuaded otherwise, it makes sense that Marriott would look for other ways to make its case. Officially, Marriott pulled the plug “in order to more quickly and comprehensively address some of the pressing security questions raised by Petitioners and to focus efforts on establishing the American Hotel & Lodging Association Cybersecurity Task Force.” Marriott describes the Task Force as “an industry task force that will partner with experts and leaders in the technology sector to find and implement the most effective market-based solutions available to tackle growing cyber threats.”While the withdrawal of the Marriott request defers resolution of the issues raised in that request, our hunch is that those issues haven’t gone away by any means. The withdrawal of the request may just be a tactical retreat; it’s probably not the end of the war.