Federal Communications Commission DA 07-4182 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of Freedom Broadcasting of Texas Licensee, L.L.C. Licensee of Station KFDM-TV Beaumont, Texas ) ) ) ) ) Facility I.D. No. 22589 NAL/Acct. No. 0841420008 FRN: 0010053064 NOTICE OF APPARENT LIABILITY FOR FORFEITURE Adopted: October 24, 2007 Released: October 26, 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 Freedom Broadcasting of Texas Licensee, L.L.C. (the “Licensee”), licensee of Station KFDM-TV, Beaumont, Texas (the “Station”), apparently willfully and repeatedly violated Section 73.3526(e)(11)(iii) of the Rules, by failing to publicize the existence and location of the Station’s Children’s Television Programming Reports.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 ten thousand dollars ($10,000). II. BACKGROUND 2. Under the Commission’s rules implementing the Children’s Television Act of 1990, (the “CTA”),4 each television broadcast station licensee has an obligation, during its license term, to air programming that serves the educational and informational needs of children through both the licensee’s overall programming and programming “specifically designed” to educate and inform children (core programming).5 The Commission’s rules require commercial licensees to provide information to the public about the shows they air to fulfill their obligation. Section 73.3526(e)(11)(iii) of the Rules requires each commercial television broadcast station to prepare and place in its public inspection file a Children’s Television Programming Report for each calendar quarter reflecting, inter alia, the efforts it has made during the quarter to serve the educational needs of children. As set forth in Section 73.3526(e)(11)(iii), licensees are also required to file the reports with the Commission and to publicize for the public the existence and location of the reports. 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. § 73.3526(e)(11)(iii). 4 Pub. L. No. 101-437, 104 Stat. 996-1000, codified at 47 U.S.C. §§ 303a, 303b and 394. 5 47 C.F.R. § 73.671. Federal Communications Commission DA 07-4182 2 3. In the CTA, 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”).6 In addition, the Commission reiterated its long-standing policy against “host-selling,” i.e., “the use of program talent to deliver commercials,” including “endorsements or selling by animated cartoon characters as well as ‘live’ program hosts.”7 4. On April 3, 2006, the Licensee filed its license renewal application (FCC Form 303-S) for Station KFDM-TV (the “Application”) (File No. BRCT-20060403BFZ). In response to Section IV, Question 10 of the Application, the Licensee stated that it had failed to publicize the existence and location of the Station’s Children’s Television Programming Reports, as set forth in Section 73.3526(e)(11)(iii) of the Rules. In Exhibit 24, the Licensee indicated that during the license term it had not taken specific action to publicize the existence and location of the Children’s Television Programming Reports, but that it recently implemented a program to comply with this requirement. 5. In response to Section IV, Question 5 of the Application, the Licensee stated that, during the previous license term, the Station failed to comply with the limits on commercial matter in children’s programming specified in Section 73.670 of the Rules. In Exhibit 19 and in a June 7, 2007 amendment to the Application, the Licensee reported that on December 23, 2006, the Station aired a CW Network commercial for Post Cereal’s Cocoa Pebbles cereal during the “Xiaolin Showdown” program. The Licensee stated that this commercial contained “small and fleeting images of characters from the Xiaolin Showdown program.” The Licensee indicated that, in this case, the CW Network’s technology was inadequate to identify the “miniscule” images of characters in the portion of the screen in which they appeared.8 III. DISCUSSION 6. 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.9 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.10 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,11 and the Commission has so interpreted the term in the Section 503(b) context.12 Section 312(f)(2) of the Act provides that “[t]he term ‘repeated,’ when used with 6 Children’s Television Programming, 6 FCC Rcd 2111, 2118, recon. granted in part, 6 FCC Rcd 5093, 5098 (1991). 7 Id. at 2127 n. 147, 6 FCC Rcd at 5097; see also Action for Children’s Television, 50 FCC 2d 1, 8, 16-17 (1974). 8 From the Licensee’s description of the “Xiaolin Showdown” commercial, it appears that this incident is more akin to a violation of the Commission’s “host-selling” policy, rather than a program-length commercial. 9 47 U.S.C. § 503(b)(1)(B); see also 47 C.F.R. § 1.80(a)(1). 10 47 U.S.C. § 312(f)(1). 11 See H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982). 12 See Southern California Broadcasting Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 (1991). Federal Communications Commission DA 07-4182 3 reference to the commission or omission of any act, means the commission or omission of such act more than once or, if such commission or omission is continuous, for more than one day.”13 7. The Commission’s Forfeiture Policy Statement and Section 1.80(b)(4) of the Rules establish a base forfeiture amount of $10,000 for violation of Section 73.3526.14 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.”15 8. The Licensee indicated that it only recently implemented procedures to comply with Section 73.3526(e)(11)(iii). Therefore, it appears that the violation in this case continued throughout the license term. Accordingly, we find that the Licensee is apparently liable for a forfeiture in the amount of $10,000 for its apparent willful and repeated violation of Section 73.3526(e)(11)(iii). IV. ORDERING CLAUSES 9. 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 Freedom Broadcasting of Texas Licensee, L.L.C. is hereby NOTIFIED of its APPARENT LIABILITY FOR FORFEITURE in the amount of ten thousand dollars ($10,000) for its apparent willful and repeated violation of Section 73.3526(e)(11)(iii) of the Commission’s Rules. 10. 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, Freedom Broadcasting of Texas Licensee, L.L.C. SHALL PAY the full amount of the proposed forfeiture or SHALL FILE a written statement seeking reduction or cancellation of the proposed forfeiture. 11. 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. 12. 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. 13. 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 13 47 U.S.C. § 312(f)(2). 14 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. 15 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 07-4182 4 the claim by reference to the financial documentation submitted. 14. Requests for full payment of the forfeiture proposed in this NAL under the installment plan should be sent to: Associate Managing Director- Financial Operations, 445 12th Street, S.W., Room 1-A625, Washington, D.C. 20554.16 15. IT IS FURTHER ORDERED that copies of this NAL shall be sent, by First Class and Certified Mail, Return Receipt Requested, to Freedom Broadcasting of Texas Licensee, L.L.C., 2955 Interstate 10 East, Beaumont, Texas 77702, and to its counsel, David D. Burns, Esquire, Latham & Watkins LLP, 555 Eleventh Street, N.W., Suite 1000, Washington, D.C. 20004-1304. FEDERAL COMMUNICATIONS COMMISSION Barbara A. Kreisman Chief, Video Division Media Bureau 16 See 47 C.F.R. § 1.1914.