Federal Communications Commission DA 07-2580 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of KTLA Inc. Licensee of Station KTLA-TV Los Angeles, California ) ) ) ) ) Facility I.D. No. 35670 NAL/Acct. No. 0741420049 FRN: 0001531615 NOTICE OF APPARENT LIABILITY FOR FORFEITURE Adopted: June 25, 2007 Released: June 29, 2007 By the Chief, Video Division, Media Bureau: I. INTRODUCTION 1. In this Notice of Apparent Liability for Forfeiture (“NAL”) issued pursuant to Section 503(b) of the Communications Act of 1934, as amended (the “Act”), and Section 1.80 of the Commission’s Rules (the “Rules”),1 by the Chief, Video Division, Media Bureau pursuant to authority delegated under Section 0.283 of the Rules,2 we find that KTLA Inc. (the “Licensee”), licensee of Station KTLA-TV, Los Angeles, California (the “Station”), apparently willfully and repeatedly violated Section 73.670 of the Rules, by failing to comply with the limits on commercial matter in children’s programming.3 Based upon our review of the facts and circumstances before us, we conclude that the Licensee is apparently liable for a monetary forfeiture in the amount of twenty thousand dollars ($20,000). II. BACKGROUND 2. In the Children’s Television Act of 1990, Pub. L. No. 101-437, 104 Stat. 996-1000, codified at 47 U.S.C. §§ 303a, 303b and 394, Congress directed the Commission to adopt rules, inter alia, limiting the number of minutes of commercial matter that television stations may air during children’s programming, and to consider in its review of television license renewal applications the extent to which the licensee has complied with such commercial limits. Pursuant to this statutory mandate, the Commission adopted Section 73.670 of the Rules, which limits the amount of commercial matter which may be aired during children’s programming to 10.5 minutes per hour on weekends and 12 minutes per hour on weekdays. The Commission also stated that a program associated with a product, in which commercials for that product are aired, would cause the entire program to be counted as commercial time (a “program-length commercial”).4 3. On August 11, 2006, the Licensee filed its license renewal application (FCC Form 303-S) for Station KTLA-TV (the “Application”) (File No. BRCT-20060811ASH). In response to Section IV, 1 47 U.S.C. § 503(b); 47 C.F.R. § 1.80. 2 See 47 C.F.R. § 0.283. 3 See 47 C.F.R. § 73.670. 4 Children’s Television Programming, 6 FCC Rcd 2111, 2118, recon. granted in part, 6 FCC Rcd 5093, 5098 (1991). Federal Communications Commission DA 07-2580 2 Question 5 of the Application, the Licensee stated that, during the previous license term, it failed to comply with the limits on commercial matter in children’s programming specified in Section 73.670 of the Rules. In Exhibit 19, the Licensee indicated that, between June 5, 1999, and April 28, 2003, it violated the children’s television commercial limits on 14 occasions. Of these overages, seven were described by the Licensee as resulting from human error or inadvertence. In addition, the Licensee described corrective measures taken by the Station to ensure future compliance with the children’s television commercial limits. 4. The Licensee also stated that on seven occasions between September 19, 2002, and September 28, 2002, the Station aired a commercial for the Nintendo GameBoy E-Reader, during the “Pokemon” program. The Licensee claimed that one of these commercials aired as a result of a network buy by the WB Network, and the remaining six commercials aired as a result of a local station buy. The Licensee indicated that the Station did not know until after broadcast, when the WB Network brought the matter to the Licensee’s attention, that the commercial contained a “fleeting, obscured image” of a “Pokemon” game card. The Licensee stated that, the image, in which only the letters “MON” are visible for just over one second, does not depict any “Pokemon” character. According to the Licensee’s description, the “Pokemon” card appears as the third of six cards arranged in the shape of a fan during the display and “Pokemon” is not mentioned in the audio of the commercial. The Licensee maintained that it had been its good faith judgment that the program-length commercial policy was inapplicable in this case because there is no likelihood that children would perceive any linkage between the “Pokemon” program and the GameBoy commercial. Further, the Licensee contended that the WB Network expressed its belief that the GameBoy commercial does not violate the Commission’s rules or policies or the Children’s Television Act’s commercial time limits. Additionally, in support of its assertion that this incident does not violate the Commission’s children’s television commercial limits, the Licensee cited the Commission’s conclusion in Complaints Regarding Various Television Broadcasts Between February 2, 2002 and March 8, 2005, 21 FCC Rcd 2664 (2006) (“Omnibus Order”), that a broadcast of “The Amazing Race 6” did not violate indecency restrictions. Specifically, in the Omnibus Order, the Commission considered whether a momentary showing of the phrase “Fuck Cops!” written on the side of a train during an episode of “The Amazing Race 6” was indecent. The Commission found that the program was not indecent under the three principal factors that comprised the Commission’s contextual analysis of this incident. III. DISCUSSION 5. Station KTLA-TV’s record during the last license term of exceeding the Commission’s commercial limits on 14 occasions, all of which were program-length commercials, constitutes an apparent willful and repeated violation of Section 73.670. With respect to the Station’s broadcast of the commercial for the Nintendo GameBoy E-Reader, although the Licensee contended that the “Pokemon” game card appeared for approximately one second during the commercial, it is well-established that the determination as to whether a particular program is a program-length commercial is not dependent on the duration of the appearance of the program-related product in the commercial announcement. The Commission has stated on numerous occasions that, where a commercial announcement includes a product related to the program in which the commercial is broadcast, then the program is a program- length commercial regardless of the duration of the appearance of the program-related product in the commercial.5 Moreover, we believe that, in the context of the cognitive abilities of young children, there is the potential for confusion between the GameBoy commercial and the “Pokemon” program regardless 5 UTV of San Francisco, Inc. (KBHK-TV), 10 FCC Rcd 10986, 10988 (1995); see also WPIX, Inc., 14 FCC Rcd 9077 (MMB 1999) (commercial for “Spirit of Mickey” home video showing brief image of Donald Duck on cover of video aired during “Quack Pack” program); Act III Broadcasting License Corp. (WUTV(TV)), 10 FCC Rcd 4957 (1995), aff’d, 13 FCC Rcd 10099 (MMB 1997) (commercial for a fast food restaurant promoting a trip to Disney World as a contest prize contained a brief image of Goofy and aired during the program “Goof Troop”). Federal Communications Commission DA 07-2580 3 whether any “Pokemon” character is depicted given the image of a “Pokemon” game card contained in the commercial and the consequent likelihood that children may associate it with the program. Although the Licensee cited a case in support of its assertion that this incident does not violate the children’s television commercial limits, that case is inapposite since it did not deal with the commingling of program content and commercial matter in children’s programming. 6. Congress was particularly concerned about program-length commercials because young children often have difficulty distinguishing between commercials and programs.6 Given this congressional concern, the Commission made it clear that program-length commercials, by their very nature, are extremely serious violations of the children’s television commercial limits, stating that the program-length commercial policy “directly addresses a fundamental regulatory concern, that children who have difficulty enough distinguishing program content from unrelated commercial matter, not be all the more confused by a show that interweaves program content and commercial matter.”7 7. The number and magnitude of overages at issue here mean that children have been subjected to commercial matter greatly in excess of the limits contemplated by Congress when it enacted the Children’s Television Act of 1990.8 The reasons the Licensee cited for seven of the program-length commercials, inadvertence and human error, do not mitigate or excuse them. The Commission has repeatedly rejected inadvertence and human error as bases for excusing violations of the children’s television commercial limits.9 Nor does the Licensee’s implementation of policies to prevent subsequent violations of the Commission’s children’s television rules and policies relieve it of liability for violations which have occurred.10 8. This NAL is issued pursuant to Section 503(b)(1)(B) of the Act. Under that provision, 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 forfeiture penalty.11 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.12 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,13 and the Commission has so interpreted the term in the Section 503(b) context.14 Section 312(f)(2) of the Act provides that “[t]he term ‘repeated,’ when used with reference to the commission or omission of any act, means the commission or omission of such act more 6 S. Rep. No. 227, 101st Cong., 1st Sess. 24 (1989). 7 Children’s Television Programming, 6 FCC Rcd at 2118. 8 Id. at 2117-18. 9 See, e.g., LeSea Broadcasting Corp. (WHKE(TV)), 10 FCC Rcd 4977 (MMB 1995); Buffalo Management Enterprises Corp. (WIVB-TV), 10 FCC Rcd 4959 (MMB 1995); Act III Broadcasting License Corp. (WUTV(TV)), 10 FCC Rcd 4957 (MMB 1995); Ramar Communications, Inc. (KJTV(TV)), 9 FCC Rcd 1831 (MMB 1994). 10 See, e.g., WHP Television, L.P. (WHP-TV), 10 FCC Rcd 4979, 4980 (MMB 1995); Mountain States Broadcasting, Inc. (KMSB-TV), 9 FCC Rcd 2545, 2546 (MMB 1994); R&R Media Corporation (WTWS(TV)), 9 FCC Rcd 1715, 1716 (MMB 1994); KEVN, Inc. (KEVN-TV), 8 FCC Rcd 5077, 5078 (MMB 1993); International Broadcasting Corp., 19 FCC 2d 793, 794 (1969). 11 47 U.S.C. § 503(b)(1)(B); see also 47 C.F.R. § 1.80(a)(1). 12 47 U.S.C. § 312(f)(1). 13 See H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982). 14 See Southern California Broadcasting Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 (1991). Federal Communications Commission DA 07-2580 4 than once or, if such commission or omission is continuous, for more than one day.”15 9. The Commission’s Forfeiture Policy Statement and Section 1.80(b)(4) of the Rules establish a base forfeiture amount of $8,000 for violation of Section 73.670.16 In determining the appropriate forfeiture amount, we may adjust the base amount upward or downward by considering the factors enumerated in Section 503(b)(2)(D) of the Act, including “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.”17 10. In this case, an upward adjustment is justified in light of the number and nature of the commercial overages. Accordingly, we find that the Licensee is apparently liable for a forfeiture in the amount of $20,000 for its apparent willful and repeated violation of Section 73.670. IV. ORDERING CLAUSES 11. Accordingly, IT IS ORDERED, pursuant to Section 503(b) of the Communications Act of 1934, as amended, and Section 1.80 of the Commission’s Rules, that KTLA Inc. is hereby NOTIFIED of its APPARENT LIABILITY FOR FORFEITURE in the amount of twenty thousand dollars ($20,000) for its apparent willful and repeated violation of Section 73.670 of the Commission’s Rules. 12. IT IS FURTHER ORDERED, pursuant to Section 1.80 of the Commission’s Rules, that, within thirty (30) days of the release date of this NAL, KTLA Inc. SHALL PAY the full amount of the proposed forfeiture or SHALL FILE a written statement seeking reduction or cancellation of the proposed forfeiture. 13. Payment of the proposed forfeiture must be made by check or similar instrument, payable to the order of the Federal Communications Commission. The payment must include the NAL/Acct. No. and FRN No. referenced above. Payment by check or money order may be mailed to Federal Communications Commission, at P.O. Box 358340, Pittsburgh, Pennsylvania 15251-8340. Payment by overnight mail may be sent to Mellon Bank/LB 358340, 500 Ross Street, Room 1540670, Pittsburgh, Pennsylvania 15251. Payment by wire transfer may be made to ABA Number 043000261, receiving bank Mellon Bank, and account number 911-6229. 14. The response, if any, must be mailed to Office of the Secretary, Federal Communications Commission, 445 12th Street, S.W., Washington, D.C. 20554, ATTN: Barbara A. Kreisman, Chief, Video Division, Media Bureau, and MUST INCLUDE the NAL/Acct. No. referenced above. 15. The Commission will not consider reducing or canceling a forfeiture in response to a claim of inability to pay unless the respondent submits: (1) federal tax returns for the most recent three- year period; (2) financial statements prepared according to generally accepted accounting practices (“GAAP”); or (3) some other reliable and objective documentation that accurately reflects the respondent’s current financial status. Any claim of inability to pay must specifically identify the basis for the claim by reference to the financial documentation submitted. 16. Requests for full payment of the forfeiture proposed in this NAL under the installment 15 47 U.S.C. § 312(f)(2). 16 See Forfeiture Policy Statement and Amendment of Section 1.80(b) of the Rules to Incorporate the Forfeiture Guidelines, Report and Order, 12 FCC Rcd 17087, 17113-15 (1997) (“Forfeiture Policy Statement”), recon. denied, 15 FCC Rcd 303 (1999); 47 C.F.R. § 1.80(b)(4), note to paragraph (b)(4), Section I. 17 47 U.S.C. § 503(b)(2)(D); see also Forfeiture Policy Statement, 12 FCC Rcd at 17100-01; 47 C.F.R. § 1.80(b)(4); 47 C.F.R. § 1.80(b)(4), note to paragraph (b)(4), Section II. Federal Communications Commission DA 07-2580 5 plan should be sent to: Associate Managing Director- Financial Operations, 445 12th Street, S.W., Room 1-A625, Washington, D.C. 20554.18 17. IT IS FURTHER ORDERED that copies of this NAL shall be sent, by First Class and Certified Mail, Return Receipt Requested, to KTLA Inc., 5800 Sunset Boulevard, Los Angeles, California 90028, and to its counsel, R. Clark Wadlow, Esquire, Sidley Austin Brown & Wood LLP, 1501 K Street, N.W., Washington, D.C. 20005. FEDERAL COMMUNICATIONS COMMISSION Barbara A. Kreisman Chief, Video Division Media Bureau 18 See 47 C.F.R. § 1.1914.