This Week in Regulation for Broadcasters:  March 18, 2024 to March 22, 2024

• Congress passed a $1.2 trillion spending bill to keep the federal government funded through the end of this fiscal year on September 30 – thereby narrowly averting a government shutdown that would have begun as of midnight on Saturday, March 23.
• The FCC issued a Notice of Apparent Liability proposing to fine Nexstar Media Group, Inc. $1,224,790 and Mission Broadcasting, Inc. $612,395.00 for their purported violations of the FCC’s broadcast ownership rules resulting from Mission’s acquisition of WPIX, New York, NY.  The FCC found that Mission’s acquisition of WPIX apparently resulted in Nexstar taking de facto control of WPIX without prior FCC authorization.  Although Mission and Nexstar have a local marketing agreement (LMA) in place – pursuant to which Nexstar programs WPIX on Nexstar’s behalf while Mission retained ultimate control over the station’s operations – the FCC found that, in practice, Nexstar actually controlled the station’s finances, personnel, and programming.  The FCC also found that Nexstar’s apparent control of WPIX resulted in Nexstar exceeding the 39% national TV audience reach limit, the National Ownership Cap, when added to Nexstar’s other TV station interests.  To remedy Nexstar’s purported violation of the National Ownership Cap, the FCC gave the parties the option of, within one year of the FCC’s issuance of an order finally ordering the fine or the payment of the fine, Mission divesting WPIX to an unrelated third party, or Mission selling WPIX to Nexstar and Nexstar to simultaneously divest a sufficient number of other TV stations to reduce below the Cap its national footprint.  Nexstar and Mission have 30 days to respond to the proposed findings in the Notice of Apparent Liability, which Nexstar stated it will do.  Chairwoman Rosenworcel stated that this action was necessary to enforce the 39% National Ownership Cap imposed by Congress.  Commissioner Carr issued a statement suggesting that Mission and Nexstar had disclosed, when Mission first acquired WPIX, much of the information relied on by the Commission in the Notice of Apparent Liability, and based on that information, the FCC approved the acquisition, thus raising questions to be reviewed when a response to the Notice is filed as to whether the parties justifiably relied on the Commission’s prior decision. 
• The FCC’s Enforcement Bureau released its first EEO audit notice for 2024, which targets 250 radio and television stations for review of their EEO compliance.  The FCC randomly audits approximately 5% of all broadcast stations each year regarding their EEO compliance.  Audited stations and their station employment units – which are commonly owned stations serving the same area – must provide to the FCC their last two years of EEO Annual Public File Reports and documentation demonstrating that the stations did everything that is required under the FCC’s EEO rules.  Audited stations have until May 6, 2024, to upload that information to their online public inspection files.  As with the last FCC audit, the FCC staff will review the audit responses and ask for additional information if they find the public file documentation to be incomplete, but they will not inform audited stations that their EEO performance was found satisfactory.  See this our article here for more detail on EEO audits and how seriously the FCC takes broadcasters’ EEO obligations.
• The FCC released the full text of its Report and Order adopted at its regular monthly Open Meeting the week before last, in which it requires cable operators and direct broadcast satellite (DBS) providers to specify the “all-in” price for video programming in their promotional materials and on subscribers’ bills.  The “all-in” price includes all video programming charges, including those for broadcast retransmission consent, regional sports, and other programming.  Cable operators and DBS providers have until December 19, 2024 to comply with the new rules, unless the Office of Management and Budget (OMB) completes its review of the new rules at a later date.  Small cable operators (those with $47 million or less in annual receipts), however, have until March 19, 2025 to comply with the new rules.
• The FCC’s Media Bureau released a Notice of Proposed Rulemaking (NPRM) in which it proposes to amend the FM Table of Allotments by downgrading the class of vacant Channel 245B to Channel 241B1 at Mattoon, Illinois.  The Bureau stated that downgrading the allotment was necessary because the existing Channel 245B did not comply with the FCC’s the 74-kilometer minimum separation distance requirement since it was short-spaced with a licensed FM station operating on Channel 248B located only 10 kilometers away.  The Bureau asserts that downgrading the vacant allotment to Channel 245B1 would result in compliance with the FCC’s minimum distance requirement.  Comments and reply comments responding to the NPRM will be due May 13 and May 28, respectively. 
• The Bureau dismissed a New Mexico construction permit application for a new noncommercial (NCE) FM station filed during the 2021 NCE FM filing window because it was not signed by an officer of the applicant.  A party who filed a mutually exclusive application (a conflicting application which could not be granted consistent with the FCC’s technical rules) objected by noting that the signature was from a person not identified as an officer in the application.  The Bureau agreed, and dismissed the application as applicants must strictly adhere to the FCC’s signature requirements in their initial application, meaning that deficiencies cannot be fixed through an amendment.  As a result of the dismissal, the Bureau accepted the objector’s application for filing as a singleton application (one that is not predicted to cause interference to any other translator application or any existing station) which will be further reviewed and potentially granted at a later time.
• The Media Bureau also took several actions dealing with recently filed applications for new LPFM stations:
  • The Bureau released a Public Notice in which it provided further guidance on the settlement window for resolving mutually exclusive (MX) new LPFM construction permit applications filed during the December 2023 filing window.  As we discussed last week, the Bureau identified several groups of MX applications and announced that such applicants have until May 14, 2024 to file settlement agreements or technical amendments to resolve their conflicts.  In this week’s Notice, the Bureau clarifies that MX applicants may also submit time-share agreements (two or more parties agree to operate a station at different times) during the settlement window to resolve their conflicts.  Time-share agreements must be in writing and signed by each party and must specify the proposed hours of operation of each party.  Each time-share party must operate the LPFM station for at least 10 hours per week and cannot operate the station simultaneously.  Time-share agreements must also be limited to three MX applicants, propose the grant of technically acceptable applications, and not create new MX conflicts. 
  • The Bureau dismissed an application for a new LPFM construction permit in Rhode Island because the applicant failed to demonstrate that it was a non-profit organization eligible to be an LPFM licensee.  An objector claimed that the applicant could not be an LPFM licensee because its certificate of authority was revoked by the Rhode Island Secretary of State.  The applicant responded that its certificate of authority had been subsequently reinstated.  The Bureau nevertheless dismissed the application because the applicant’s certificate of authority was revoked as of the date that the application was filed.  The Bureau, however, stated that the application could be reinstated if the applicant demonstrated that the applicant remained qualified as a non-profit entity under Rhode Island law while its certificate of authority was revoked, or that its reinstatement had retroactive effect. 
  • The Bureau affirmed its dismissals of New Hampshire and Mississippi LPFM construction permit applications because the applicants failed to meet the co-channel and/or second-adjacent channel spacing requirements necessary for protecting nearby full-power FM stations.  The applicants claimed that the failure resulted from their engineers’ typographical errors and requested that the Bureau allow them to amend their applications to fix their errors.  The Bureau rejected the applicants’ requests because typographical error claims are not an acceptable basis for reinstating and amending an LPFM application, as the rules state that the failure to meet spacing requirements (or to request a waiver) in an initial application is fatal to an application and cannot be cured by an amendment.

On our Broadcast Law Blog this past week, we looked at the trademark issues that can arise from uses of the well-known words and phrases associated with the NCAA basketball tournaments in advertising, promotions, and other media coverage (see here and here).