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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
)
MINORITY TELEVISION PROJECT, ) File No. 00-IH-0153
INC. ) File No. 01-IH-0652
) NAL/Acct. No. 200232080020
Licensee of Noncommercial ) Facility #43095
Educational ) FRN # 0005704366
Television Station KMTP-TV
San Francisco, California
FORFEITURE ORDER
Adopted: December 19, 2003 Released: December 23,
2003
By the Chief, Enforcement Bureau:
I. INTRODUCTION
1. By this Forfeiture Order, we impose a forfeiture of
$10,000 on Minority Television Project, Inc. (``Minority''),
licensee of noncommercial educational television Station KMTP-TV,
San Francisco, California, for its willful and repeated broadcast
of advertisements over the station, in violation of section 399B
of the Communications Act of 1934, as amended (the ``Act''),1 and
section 73.621(e) of the Commission's rules.2 We take this
action pursuant to 47 U.S.C. § 503(b)(1)(D) and 47 C.F.R. §
1.80(f)(4). We further dismiss Minority's pending June 13, 2000,
Request for Declaratory Ruling as moot.
II. BACKGROUND
2. This case arose from allegations raised in a Media
Bureau (``MB'') proceeding and referred to the Enforcement Bureau
(``Bureau'') for resolution. In the MB proceeding, Minority
submitted a Petition for Declaratory Ruling that sought
Commission approval of numerous underwriting announcements that
the station had broadcast, arguing that the announcements comply
with the pertinent statutory and Commission rule provisions that
prohibit the broadcast of commercial messages over noncommercial
educational stations. In response, AT&T Broadband, LLC
(``AT&T''), operator of cable systems in the San Francisco
market, and Lincoln Broadcasting Company (``Lincoln''), licensee
of commercial Station KTSF(TV), Brisbane, California, opposed
Minority's Request, and complained that KMTP-TV has continuously
broadcast prohibited underwriting announcements since June 1999.
By letters dated November 9, 2001, and February 25, 2002, the
Bureau inquired of Minority, and received numerous responsive
pleadings thereafter from both Minority and Lincoln.
3. By Notice of Apparent Liability for Forfeiture,3 the
Chief, Enforcement Bureau rejected Minority's arguments, and
found that it had apparently violated the pertinent statute and
Commission rules, and proposed a monetary forfeiture of $10,000.4
On September 9, 2002, Minority responded to the NAL, arguing that
the Bureau's ruling was erroneous, and that the proposed
forfeiture should be rescinded.5 Minority further asks that the
Commission act on its Petition for Declaratory Ruling, which
sought to establish that the announcements in controversy comply
with Commission underwriting announcement guidelines.
III. DISCUSSION
4. Advertisements are defined by the Act as program
material broadcast "in exchange for any remuneration" and
intended to "promote any service, facility, or product" of for-
profit entities. 47 U.S.C. § 399b(a). As noted above,
noncommercial educational stations such as Station KMTP-TV may
not broadcast advertisements. Although contributors to
noncommercial stations may receive on-air acknowledgements, the
Commission has held that such acknowledgements may be made for
identification purposes only, and should not promote the
contributors' products, services, or business.
5. Specifically, such announcements may not contain
comparative or qualitative descriptions, price information, calls
to action, or inducements to buy, sell, rent or lease.6 At the
same time, however, the Commission has acknowledged that it is at
times difficult to distinguish between language that promotes
versus that which merely identifies the underwriter.
Consequently, it expects only that licensees exercise reasonable,
good faith judgment in this area.7
6.Commission Standards. Minority first argues that the
difficulty licensees encounter in distinguishing language that
``identifies'' versus that which ``promotes'' a contributor's
products or services is ``so pervasive--no matter the language
involved''8 that it renders the Commission's policy identified in
either the Public Notice or the Commission precedent underlying
that Notice9 ``incapable of being applied in a consistent and
objective manner,''10 and that the Bureau's NAL relying on that
policy was ``based solely on subjective judgments.''11 Minority
further contends that the NAL failed to provide ``much needed
guidance in attempting to comply with the Commission's rules,''12
and asks that the Commission ``re-visit the issue and clarify its
standards.''13
7.The Commission has recognized that ``it may be difficult
to distinguish at times between announcements that promote and
those that identify.''14 Thus, it defers to ``reasonable, good
faith judgments'' by licensees and finds violations only where
material is ``clearly'' promotional as opposed to identifying.15
We believe that this test is sufficiently clear and objective
particularly as applied in this case. As discussed in further
detail below, we believe that any reasonable licensee, acting in
good faith, would have readily concluded that these announcements
were ``clearly'' promotional.
8.Minority contends that the NAL erred in citing
announcements that included language or images that ```heavily
dwelled' on the sponsor's product's particular features, or
```encourage[d] patronage.''16 Minority argues that, because the
Commission did not articulate these particular factors in either
the Public Notice or the 1984 Policy Statement, they cannot be
relied on as a basis for Commission sanction in this case.
Similarly, Minority argues that the NAL's reliance on unpublished
or staff-level precedent undermines the NAL's validity.17
9.First, the validity of findings proposed in the NAL is
not called into question merely because the Commission itself has
not, in its earlier policy pronouncements--including the Public
Notice and the Policy Statements--or in subsequent cases,
directly discussed each possible factor that might be present in
explaining a prohibited comparative or promotional expression.
Specifically, Minority objects to the NAL's explanation that
certain announcements were promotional because they ``heavily
dwell on their underwriter's products or services at length'' 18
or ``encourage patronage.'' 19 Minority points to no precedent,
issued by the Commission or its staff, substantively at odds with
the NAL's analysis. Indeed, the analysis is fully consistent
with prior Commission precedent. We believe that any reasonable
licensee acting in good faith would recognize that announcements
that heavily dwell on the products or services at length and/or
encourage or induce patronage are promotional rather than simply
used to identify. Indeed, contrary to Minority's argument that
it lacked notice that the airing of such announcement was
impermissible, the Public Notice unambiguously reminds licensees
that Commission policy specifically forbids the use of
announcements that ``contain an inducement to buy, sell, rent or
lease'' the underwriter's products.20 The fact that the NAL
noted that such finding was consistent with the approach also
followed in past unpublished letter rulings does not diminish its
validity.21 Indeed, while we did not cite the unpublished
letters to suggest they be used against Minority, they do
underscore the consistency in the Commission's handling of such
matters.
10. Foreign-Language Broadcasts. Minority argues
further that our application of the statute to its announcements
was constitutionally suspect because we did not take into account
aspects of Asian culture inherent in the text of each
announcement.22 Minority contends that, in so doing, the NAL
improperly discriminated against licensees, such as Minority,
whose programming caters to members of minority populations who
speak foreign languages.23 Minority's arguments are without
merit. First, we accepted the English translation of the
broadcasts that Minority proffered, and, consistent with the Act
and applicable precedent, found that the announcements violated
the provisions of section 399B.24 Moreover, licensees are
responsible for ensuring that material broadcast in a foreign
language conforms to the requirements of the Act and the
Commission's rules.25 Thus, the Commission does not recognize
any special exception to licensee responsibility based upon the
fact that the programming at issue is in a foreign language.26
Moreover, for the reasons specifically noted in the NAL, the
federal Court Interpreters' Act27 cited by Minority in its
response to the NAL28 does not bear on the Commission's
substantive analysis of foreign-language underwriting
announcements,29 and Minority has not demonstrated otherwise.
11. Good Faith Judgment. Minority further contends that
the NAL failed to defer to the licensee's reasonable good faith
judgment consistent with the Commission's pronouncements in
Xavier.30 Minority contends that its internal station
underwriting policy is consistent with both the Commission's
standards and those of leading public broadcasters, and that the
NAL failed to accord due deference to it, as the licensee, in its
application of those standards regarding the announcements in
question.31 Moreover, Minority argues that the NAL did not
explain how Minority ``lacked good faith'' in broadcasting
them.32 We reject these arguments. Contrary to Minority's
implication, licensee discretion under Xavier is not unlimited,
but is constrained by the bounds of reason.33 The NAL properly
evaluated Minority's discretion under Xavier through a reasonable
objective intent standard,34 and concluded that the announcements
in question violated section 399B of the Act based on the total
circumstances of the case, including the text and visual aspects
of the announcements themselves, and Minority's explanations, and
then applying the pertinent Commission underwriting policy and
precedent.35 After again reviewing the record, we conclude that
no reasonable licensee, exercising its good faith judgment, could
conclude that these announcements are anything but promotional.
12. Record Evidence and Specific Announcements. Minority
alleges that the NAL ``overlooked and mischaracterized record
evidence,''36 and that its determinations as to specific
announcements are erroneous.37 Except as to the station's
broadcast of the State Farm announcement, we disagree.38
Contrary to Minority's assertion, the NAL properly relied on the
complainant's translations for the Met-Life, Scandinavian
Furniture, Sincere Plumbing and East West Bank announcements
because the licensee failed to provide any alternative
versions.39 Moreover, to the extent that Minority commented on
the complainant's translations for those announcements, we
accepted Minority's version of the translation and Minority's
stated reasons for airing them, and accorded the licensee due
accord in light of the full evidence of record.40 Contrary to
Minority's assertion, the NAL acknowledged that the licensee had
disputed aspects of the complainant's grammar and phrasings, but
after accepting Minority's views, concluded that these
differences did not impact the announcements' overall meaning.41
As discussed in the NAL, that analysis was not limited to the
announcements' linguistic elements alone, but also considered
their visual aspects.42
13. Minority specifically asserts that the NAL's finding
that the announcement made on behalf of State Farm was
erroneous.43 Minority argues that the Act requires there to have
been a quid pro quo exchange of consideration between the
underwriter and the licensee for a violation of section 399B to
exist.44 Minority contends that, in this case, there was no
violation because no support of any kind was given except for the
underlying program and announcement themselves, and that these
materials were not provided by State Farm, but by an independent
producer.45 Minority argues that the station's broadcast of the
State Farm announcement was therefore unsupported and harmless.
We reject this argument. The Act does not require that the
consideration involved be supplied directly by the sponsor or
underwriter itself.46 The Commission has long held that
promotional statements made on behalf of for-profit entities,
made in exchange for the receipt or reasonable anticipation of
consideration, are prohibited under section 399B, and that
cognizable consideration may take many forms.47 In this case,
the fact that a third-party independent producer, and not State
Farm, supplied the programming and promotional announcement to
the station, though immaterial to the issue of whether the
licensee violated section 399B, is, however, a mitigating factor
under the circumstances of this case.48 Therefore, we will not
consider Minority's broadcast of the State Farm announcement in
assessing the forfeiture amount.49
14. Minority also argues that the NAL erred in concluding
that the announcements made on behalf of Gingko-Biloba Tea and
Korean Airlines were promotional, contending that the NAL wrongly
rejected its explanation that the presentations were value-
neutral because they were intended to be ``farcical'' or
``harmless image announcements,'' respectively.50 We disagree.
For the reasons set forth in the NAL, the announcements in
question exceeded the identification-only purpose of underwriting
announcements and were clearly promotional.51
15. We further reject Minority's argument that the NAL
erred in proposing the forfeiture amount based on the 1,911 times
that the announcements were aired during the years 2000 through
2002, instead of the number of announcements at issue, 18.52
Minority cites no authority for its contention that repeated
broadcasts of prohibited underwriting announcements should be
aggregated, and the applicable statute and Commission rule on
this issue provides otherwise.53 Except as it pertained to the
State Farm announcement, the NAL properly considered the total
circumstances of the case, including the number of announcements,
the duration, gravity, egregiousness, and continuing nature of
the violations involved.54 In any event, given the large number
of promotional announcements, we believe that a $10,000
forfeiture is hardly excessive in light of the $2,000 base amount
for a single violation.55 Finally, Minority seeks a ruling on
its Petition for Declaratory Ruling in which it requested that
the Commission declare that the specific underwriting
announcements in question are consistent with applicable
statutory and regulatory standards.56 In view of our action
affirming, in all but one instance, the NAL's finding that the
subject announcements violated section 399B of the Act and
Section 73.621 of the Commission's rules, we shall dismiss
Minority's Petition for Declaratory Ruling as moot.
IV. FORFEITURE
16. Under section 503(b)(1) of the Act, any person who is
determined by the Commission to have willfully or repeatedly
failed to comply with any provision of the Act or any rule,
regulation, or order issued by the Commission shall be liable to
the United States for a monetary forfeiture penalty.57 In order
to impose such a forfeiture penalty, the Commission must issue a
notice of apparent liability, the notice must be received, and
the person against whom the notice has been issued must have an
opportunity to show, in writing, why no such forfeiture penalty
should be imposed.58 The Commission will then issue a forfeiture
if it finds by a preponderance of the evidence that the person
has violated the Act or a Commission rule.59 As set forth above,
we conclude under this standard that Minority is liable for a
forfeiture for its apparent willful violation of 47 U.S.C. § 399b
and 47 C.F.R. § 73.621.
17. The Commission's Forfeiture Policy Statement sets a
base forfeiture amount of $2,000 for enhanced underwriting rule
violations.60 The Forfeiture Policy Statement also specifies
that the Commission shall adjust a forfeiture based upon
consideration of the factors enumerated in section 503(b)(2)(D)
of the Act, 47 U.S.C. § 503(b)(2)(D), such as ``the nature,
circumstances, extent and gravity of the violation, and, with
respect to the violator, the degree of culpability, any history
of prior offenses, ability to pay, and such other matters as
justice may require.''61 In this case, taking all of these
factors into consideration, we find that the NAL properly
proposed that the compounded forfeiture amount of $10,000 is the
appropriate sanction for the violations described above.
Consequently, Minority is liable for a forfeiture of Ten Thousand
Dollars ($10,000).
V. ORDERING CLAUSES
18. Accordingly, IT IS ORDERED, pursuant to Section
503(b) of the Communications Act of 1934, as amended,62 and
Sections 0.111, 0.311 and 1.80 of the Commission's rules,63 that
Minority Television Project, Inc., licensee of noncommercial
educational Station KMTP-TV, San Francisco, California, FORFEIT
to the United States the sum of Ten Thousand Dollars ($10,000)
for willfully and repeatedly broadcasting advertisements in
violation of Section 399B of the Act, 47 U.S.C. § 399b, and
Section 73.621 of the Commission's rules, 47 C.F.R. § 73.621. IT
IS ALSO ORDERED that Minority's Petition for Declaratory Ruling
dated June 13, 2000, IS DISMISSED AS MOOT.
19. Payment of the forfeiture may be made by mailing a
check or similar instrument, payable to the order of the Federal
Communications Commission, to the Forfeiture Collection Section,
Finance Branch, Federal Communications Commission, P.O. Box
73482, Chicago, Illinois 60673-7482, within thirty (30) days of
the release of this Forfeiture Order. See 47 C.F.R. § 1.80(h).
The payment MUST INCLUDE the FCC Registration Number (FRN)
referenced above, and also should note the NAL/Acct. No.
referenced above. If the forfeiture is not paid within that
time, the case may be referred to the Department of Justice for
collection pursuant to 47 U.S.C. § 504(a).
20. IT IS FURTHER ORDERED that a copy of this
Forfeiture Order shall be sent, by Certified Mail Return Receipt
Requested, to Minority Television Project, Inc., care of its
attorney, James L. Winston, Esq., Rubin, Winston, Diercks, Harris
& Cooke, LLP, 1155 Connecticut Avenue, N.W., Washington, DC
20036.
FEDERAL COMMUNICATIONS COMMISSION
David H. Solomon
Chief, Enforcement Bureau
_________________________
1 47 U.S.C. § 399b.
2 47 C.F.R. § 73.621(e).
3 In the Matter of Minority Television Project, Inc., 17 FCC Rcd
15646 (EB 2002) (``NAL'').
4 See id.
5 See Response of Minority Television Project, Inc., filed
September 9, 2002 (``Response'').
6 See In the Matter of the Commission Policy Concerning the
Noncommercial Nature of Educational Broadcasting Stations, Public
Notice (1986), republished, 7 FCC Rcd 827 (1992) (``Public
Notice'').
7
See Xavier University, 5 FCC Rcd 4920 (1990).
8 Response at 3.
9 See Commission's Policy Concerning the Noncommercial
Educational Nature of Educational Broadcasting Stations, 90 FCC
2d 895 (1982) (``1982 Policy Statement''), recon., 97 FCC 2d 255
(1984) (``1984 Policy Statement'') (collectively, the ``Policy
Statements'').
10
Response at 3.
11
Id.
12 Id.
13 Id.
14 Xavier, 5 FCC Rcd at 4920.
15 Id.
16 See NAL at ¶¶ 15, 25.
17 See NAL at ¶¶ 12, 13, 15, 17, 22, 25, 28.
18 See Board of Education of New York (WNYE-TV), 7 FCC Rcd 6864
(MMB 1992).
19 The actual language used in the NAL was ``induce patronage.''
NAL at ¶ 25.
20 Id.
21
See, e.g., Letter of the Chief, Complaints & Political
Programming Branch, Enforcement Division, to Evansville-
Vanderburgh School Corporation (WPSR(FM)) (MMB March 23, 1999).
22 Response at 5. Minority argues that, in failing to apply to
this case the standards set forth in the federal Court
Interpreter's Act, the NAL improperly rejected the congressional
mandate of ``cultural analysis.'' Id. at 7. Minority further
contends that the NAL, in proposing a monetary fine for
announcements that, if analyzed that in their proper cultural
context, would be deemed to comply with Commission policy,
imposed a ``chilling effect'' on the licensee's speech, and did
not afford the ``quasi-suspect class'' of foreign language-
speaking broadcasters like itself with the appropriate standard
of heightened constitutional protection, citing U.S ex rel.
Negron v. New York, 434 F.2d 386 (2d Cir. 1970) and Olagues v.
Russioniello, 797 F.2d 1511 (9th Cir. 1995) (en banc), in
support. Id. at 7-8.
23 Id. at 8.
24 NAL at ¶¶ 7-9.
25 See Licensee Responsibility to Exercise Adequate Control Over
Foreign Language Programs, 39 FCC 2d 1037 (1973).
26 Id.
27 28 U.S.C. § 1827(j).
28 Response at 6.
29 NAL at ¶ 8, n.7.
30 Response at 9.
31 Id.
32 Id.
33 See In re Window to the World Communications, Inc. (WTTW(TV)),
DA 97-2535 (MMB December 3, 1997), forfeiture reduced, 15 FCC Rcd
10025 (EB 2000).
34 Id.
35 NAL at ¶¶ 4-9.
36 Response at 10.
37 Id. at 11.
38 For the reasons discussed infra, we agree with Minority that
its broadcast of the State Farm announcement should not have been
considered against it in the NAL.
39 Minority contends that its translations for those
announcements are contained in its March 25, 2002, Reply to the
staff's February 25, 2002, letter of inquiry (``Reply'') at
Exhibit L-3. Id. at 11. However, its Reply contains no such
material, only an Exhibit marked with the letter ``L,'' which is
comprised only of the one-page Statement of announcement reviewer
Candy Chan. Moreover, Ms. Chan's Statement does not address the
announcements in question, nor has Minority provided them in its
Response to the NAL. The translations provided by Minority in
its Reply are contained at Exhibit P to that pleading, and
include its translations for the announcements made on behalf of
Yip's Auto World and Ulfert's Furniture, which were duly
acknowledged in the NAL. See NAL at ¶ 23.
40 NAL at ¶¶ 23-25.
41 NAL at ¶ 23, n.19.
42 NAL at ¶ 23-29.
43 Response at 12-13.
44 Id.
45 Id.
46 47 U.S.C. § 399b(a)(1) specifically provides: ``for purposes
of this section, the term `advertisement' means any message or
other programming material which is broadcast or otherwise
transmitted in exchange for any remuneration, and which is
intended to promote any service, facility or product offered by
any person who is engaged in such offering for profit.''
47 1982 Policy Statement, 90 FCC 2d at 911-12, ¶¶ 26-28. While
the Commission has acknowledged that non-commercial licensees
have discretion to air announcements promoting for-profit
entities where the station wishes to make listeners aware of a
for-profit entity's ``transitory events,'' it required that
licensees make such announcements only where public-interest
determinations, and not economic considerations, were the basis
for the announcements. In this case, Minority made no such claim
concerning any announcement.
48 See In re Window to the World Communications, Inc. (WTTW(TV)),
DA 97-2535 (MMB December 3, 1997), forfeiture reduced, 15 FCC Rcd
10025 (EB 2000). In that case, the Mass Media Bureau found
consideration to exist where an announcement made on behalf of
Prudential Securities and its underlying programming were
supplied by a third-party producer. However, the Mass Media
Bureau took cognizance of, and found mitigating, the manner in
which the announcement and programming were supplied to the
station -- that they were not station-produced but were supplied
automatically through satellite feed and inadvertently aired.
In this case, Minority similarly claimed that the State Farm
announcement was contained as part of a satellite-feed contained
in the program ``Minority Business Report,'' and was
inadvertently aired. See Response of Minority Television
Project, Inc., to Charles W. Kelley, Chief, Investigations and
Hearings Division, Enforcement Bureau, dated December 20, 2001,
at 2, n.1
49 Minority broadcast the State Farm announcement only once, on
September 25, 2000. See NAL at 13.
50 Response at 13.
51 NAL at ¶ 21.
52 Response at 14; NAL at ¶ 30, n.24. Although Minority contends
that we took into consideration the broadcast of 20 separate
underwriting announcements, both the discussion contained in the
NAL and the list set forth in the ruling's appended Table A
indicate that only 18 announcements were considered.
53 See 47 U.S.C. § 503(b)(2); note to 47 C.F.R. § 1.80(b)(4).
Under section 503(b) of the Act, each prohibited broadcast may be
deemed to constitute a separate offense. See also The
Commission's Forfeiture Policy Statement and Amendment of Section
1.80 of the Rules to Incorporate the Forfeiture Guidelines, 12
FCC Rcd 17087, 17113 (1997), recon. denied 15 FCC Rcd 303 (1999)
(``Forfeiture Policy Statement''). The base amounts for enhanced
underwriting violations listed in the Commission's Forfeiture
Guidelines are $2,000.00 for a single violation or single day of
a continuing violation.
54 NAL at ¶¶ 30-32.
55 Indeed, even if we took out of the forfeiture the six specific
announcements challenged by Minority, apart from the State Farm
announcement that we now exclude, the remaining 11 unlawful
announcements would still justify a forfeiture of $10,000. See
¶¶ 12-14, supra.
56 Response at 14.
57 47 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(1); see also 47
U.S.C. § 503(b)(1)(D) (forfeitures for violation of 14 U.S.C. §
1464). Section 312(f)(1) of the Act defines willful as ``the
conscious and deliberate commission or omission of [any] act,
irrespective of any intent to violate'' the law. 47 U.S.C. §
312(f)(1). The legislative history to section 312(f)(1) of the
Act clarifies that this definition of willful applies to both
sections 312 and 503(b) of the Act, H.R. Rep. No. 97-765, 97th
Cong. 2d Sess. 51 (1982), and the Commission has so interpreted
the term in the section 503(b) context. See, e.g., Application
for Review of Southern California Broadcasting Co., Memorandum
Opinion and Order, 6 FCC Rcd 4387, 4388 (1991) (``Southern
California Broadcasting Co.''). The Commission may also assess a
forfeiture for violations that are merely repeated, and not
willful. See, e.g., Callais Cablevision, Inc., Grand Isle,
Louisiana, Notice of Apparent Liability for Monetary Forfeiture,
16 FCC Rcd 1359 (2001) (issuing a Notice of Apparent Liability
for, inter alia, a cable television operator's repeated signal
leakage). ``Repeated'' merely means that the act was committed
or omitted more than once, or lasts more than one day. Southern
California Broadcasting Co., 6 FCC Rcd at 4388, ¶ 5; Callais
Cablevision, Inc., 16 FCC Rcd at 1362, ¶ 9.
58 47 U.S.C. § 503(b); 47 C.F.R. § 1.80(f).
59 See, e.g., SBC Communications, Inc., Apparent Liability for
Forfeiture, Forfeiture Order, 17 FCC Rcd 7589, 7591, ¶ 4 (2002)
(forfeiture paid).
60 See Forfeiture Policy Statement, 12 FCC Rcd at 17113; 47
C.F.R. § 1.80(b).
61 Forfeiture Policy Statement, 12 FCC Rcd at 17100-01, ¶ 27.
62 See 47 U.S.C. § 503(b).
63 See 47 C.F.R. §§ 0.111, 0.311, and 1.80.