Click here for Microsoft Word Version
********************************************************
NOTICE
********************************************************
This document was converted from
WordPerfect or Word to ASCII Text format.
Content from the original version of the document such as
headers, footers, footnotes, endnotes, graphics, and page numbers
will not show up in this text version.
All text attributes such as bold, italic, underlining, etc. from the
original document will not show up in this text version.
Features of the original document layout such as
columns, tables, line and letter spacing, pagination, and margins
will not be preserved in the text version.
If you need the complete document, download the
Word or WordPerfect version or Adobe Acrobat version (above).
*****************************************************************
Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
AMFM RADIO LICENSES, L.L.C. ) File No. 99050522
) NAL/Acct. No. 200132080003
Licensee of Station WKQI(FM) ) Facility ID# 6592
Detroit, Michigan ) JJS
)
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: October 11, 2000 Released: October 12,
2000
By the Chief, Enforcement Bureau:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture, we
find AMFM Licenses, L.L.C. (``AMFM''), licensee of Station
WKQI(FM), Detroit, Michigan, apparently liable for a forfeiture
in the amount of four thousand dollars ($4,000) for a violation
of Section 317(a)(1) of the Communications Act of 1934, as
amended, 47 U.S.C. § 317(a)(1), and Section 73.1212 of the
Commission's rules, 47 C.F.R. § 73.1212, which requires
licensees, among other things, to make sponsorship identification
announcements whenever a station broadcasts matter in return for
money, service, or other valuable consideration. We find that
AMFM broadcast a record, ``On A Day Like Today'' by Bryan Adams,
in consideration for Mr. Adams' agreement to appear at a concert
sponsored by the station, without airing required sponsorship
identification announcements.
II. BACKGROUND
2. On February 2, 1998, John Madison, Sr., the Senior Vice
President Regional Operations for Chancellor Media Corporation
(``Chancellor''), the parent corporation of the licensee,1
invited other Chancellor executives and representatives from
record labels to discuss ways that record labels could use
Chancellor stations to better introduce and promote records.
Following that meeting, which took place in New York in February
1998, Chancellor and Mercury Records developed a marketing
campaign for Shania Twain to market her as a Top 40 artist. The
campaign included sixty second artist profile spots featuring the
artist speaking about her music, excerpts from her song, and a
``retail tag'' informing listeners where they could purchase her
CD. Chancellor viewed that campaign to be highly successful.
3. Following the Shania Twain campaign, Chancellor began
marketing these types of campaigns to record labels. In June or
July 1998, representatives of A&M Records played ``On a Day Like
Today,'' a song by Bryan Adams, to John Ivey, the Program
Director at Chancellor station WXKS, Boston, Massachusetts.
Subsequently, on July 15, 1998, A&M representatives met with Mr.
Madison and Bev Tilden, Chancellor's Vice President of Marketing,
to discuss a marketing campaign for that song. After a couple of
months of negotiations, on September 23, 1998, Chancellor and A&M
entered into an agreement. Under the agreement, A&M would
purchase commercials on ten Chancellor stations (including WKQI-
FM), make Mr. Adams available for live concerts in various cities
with Chancellor stations, and provide CDs, airfare, and seats for
contests. In return, the Chancellor stations agreed to run live
and recorded announcements, liners, promos, and contests
promoting the new Bryan Adams song. The stations also agreed to
provide hotel accommodations and spending money for the contests.
In the written agreement, Chancellor did not make any
representations concerning playing the Adams single.
4. On November 10, 1998, Morty Wiggins of A&M Records sent
a letter to Chuck Armstrong of Chancellor canceling Mr. Adams'
appearance at a concert in Dallas. On the afternoon of November
11, Mr. Wiggins called John Bassanelli, Chancellor's Managing
Director, to say that Mr. Adams would not perform at WKQI's
concert because the cancellation of the Dallas show had made it
prohibitively expensive for Mr. Adams to be on the road for the
December 9, 1998 Detroit show. According to Chancellor, Tom
O'Brien, the station's Program Director, ``was frantic at the
prospect of a concert cancellation'' because the station had
promoted the concert, secured a venue, and booked other acts to
appear with Mr. Adams. Mr. O'Brien then made ``various promises
and concessions'' in the hope of saving the concert. Later on
November 11, 1998, Mr. Bassanelli wrote a letter to Mr. Wiggins
stating ``Per Tom O'Brien, the stations will commit to the
following items in return for a firm and non-cancelable
performance by Bryan Adams:
1. Immediate increase of spins of the current single
`On A Day Like Today' to a minimum of 25 times per week
through the week ending December 26. The station will
guarantee and fair and even [sic] rotation through
critical day parts.
2. Guaranteed immediate add (out of the box) of the
next release with a minimum 15 spins per week for five
(5) weeks.''
The station also agreed to move the concert date to December 13,
1998 and to provide a station appearance at a local record
retailer of A&M's or Mr. Adams' choosing.
5. After November 11, the station played ``On A Day Like
Today'' considerably more often and at more favorable times than
prior to that date. From November 5 through November 11, WKQI
played the record 13 times, and over half of those plays were
between midnight and 6:00 a.m. From November 12 through November
18, the station played the record 29 times, and over half of
those plays were between 7:00 a.m. and 7:00 p.m. Except for
Saturday, November 28 and Saturday, December 5, the station
played ``On A Day Like Today'' at least three times a day every
day from November 11 through December 13. See January 18, 2000
Response to Letter of Inquiry, Exhibit 11. The station did not
air any sponsorship identification announcements in connection
with the playing of the record. After the concert, the station
only played ``On A Day Like Today'' nine more times (during the
period from December 14 through December 21). The station never
played the ``next release'' referred to in the November 11
letter.
6. According to AMFM, Messrs. Bassanelli and O'Brien did
not consult with the Chancellor Legal Department, outside
counsel, or more senior Chancellor executives before reaching
their agreement with A&M. On December 23, 1998, after
publication of newspaper articles reporting on the relationships
between record companies and radio station groups, Jimmy de
Castro, Chancellor's Chief Operating Officer, sent a memorandum
to all Chancellor Radio Group employees stating ``our promotional
packages do not and may not include increased airplay as part of
the deal. We do NOT accept `pay for play' arrangements (either
direct or indirect) and we do NOT make airplay decisions based on
the sale of these packages.''
III. DISCUSSION
7. Section 317(a)(1) of the Act provides:
All matter broadcast by any radio station for which any
money, service or other valuable consideration is
directly or indirectly paid, or promised to or charged
or accepted by, the station so broadcasting, from any
person, shall, at the time the same is so broadcast, be
announced as paid for or furnished, as the case may be,
by such person: Provided, That "service or other
valuable consideration" shall not include any service
or property furnished without charge or at a nominal
charge for use on, or in connection with, a broadcast
unless it is so furnished in consideration for an
identification in a broadcast of any person, product,
service, trademark, or brand name beyond an
identification which is reasonably related to the use
of such service or property on the broadcast.
Similarly, Section 73.1212(a) of the Commission's rules provides,
in pertinent part:
When a broadcast station transmits any matter for which
money, service, or other valuable consideration is
either directly or indirectly paid or promised to, or
charged or accepted by such station, the station, at
the time of the broadcast, shall announce:
(1) That such matter is sponsored, paid for, or
furnished, either in whole or in part, and
(2) By whom or on whose behalf such consideration was
supplied. . . .
8. In this case, AMFM apparently violated those provisions
by not airing sponsorship identification announcements during the
times it played ``On A Day Like Today'' pursuant to the station's
November 11 agreement with A&M Records. Under that agreement,
the station agreed, among other things, to increase the number of
times it would play the record in return for ``a firm and non-
cancelable performance by Bryan Adams'' at the station's concert.
9. AMFM argues that while the station made an airplay
commitment, ``because the concert was already promised in
connection with the promotion as originally planned, no
additional consideration was given by Adams or A&M in return for
the commitment on airplay.'' See May 27, 1999 Response to Letter
of Inquiry, p. 4. We reject that argument as contrary to the
language of the agreements, as well as the language and intent of
the rule. The original agreement between Chancellor and A&M only
provided that the Detroit concert was a ``pending'' concert, as
opposed to the ``firm'' concerts in Boston, New York, and
Orlando. In contrast, when the station agreed to increase the
number of times it would play ``On A Day Like Today,'' it
received, in return, a ``firm and non-cancelable performance'' by
Mr. Adams. Thus, AMFM clearly received an additional benefit in
return for the promised airplay. Moreover, AMFM's statement that
Mr. O'Brien ``made various promises and concessions in the hope
of saving the concert'' further demonstrates that his commitment
to play the record more often was part of the consideration he
was offering in return for the concert. Moreover, subject to
exceptions that are not pertinent here, Section 73.1212 requires
sponsorship identification announcements whenever ``money,
service, or other valuable consideration is either directly or
indirectly paid or promised to, or charged to or accepted by such
station . . . .'' That broad language clearly encompasses the
agreement between the station and A&M. Since the station
received the consideration of a ``firm'' concert in return for
playing ``On A Day Like Today,'' and since the station did not
air sponsorship identification announcements when it played the
song, the station apparently violated Section 317 of the Act and
Section 73.1212 of the Commission's rules.
10. Section 503(b) of the Communications Act, 47 U.S.C. §
503(b), and Section 1.80(a) of the Commission's rules, 47 C.F.R.
§ 1.80(a), both state that any person who willfully or repeatedly
fails to comply with the provisions of the Communications Act or
the Commission's rules shall be liable for a forfeiture penalty.
For purposes of Section 503(b), the term ``willful'' means that
the violator knew it was taking the action in question,
irrespective of any intent to violate the Commission's rules.
See Southern California Broadcasting Co., 6 FCC Rcd 4387 (1991).
Furthermore, a continuing violation is ``repeated'' if it lasts
more than one day. Id., 6 FCC Rcd at 4388.
11. The Commission's Forfeiture Policy Statement sets a
base forfeiture amount of $4,000 for sponsorship identification
violations.2 After considering the record and all of the factors
contained in Section 503(b)(2)(D) of the Act, 47 U.S.C. §
503(b)(2)(D), and the Forfeiture Policy Statement, we believe a
$4,000 forfeiture is appropriate in this case.
IV. ORDERING CLAUSES
12. ACCORDINGLY, IT IS ORDERED THAT pursuant to Section
503(b) of the Communications Act of 1934, as amended, and
Sections 0.111, 0.311 and 1.80 of the Commission's rules,3 AMFM
is hereby NOTIFIED of its APPARENT LIABILITY FOR FORFEITURE in
the amount of four thousand dollars ($4,000) for willfully and
repeatedly violating Section 73.1212 of the Commission's rules.
13. IT IS FURTHER ORDERED, pursuant to Section 1.80 of the
Commission's rules, that within thirty days of the release of
this Notice, AMFM SHALL PAY to the United States the full amount
of the proposed forfeiture or SHALL FILE a written statement
seeking reduction or cancellation of the proposed forfeiture.
14. Payment of the forfeiture may be made by credit card
through the Commission's Credit and Debt Management Center at
(202) 418-1995 or 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. The payment should note the NAL/Acct. No. referenced
above.
15. The response, if any, must be mailed to Charles W.
Kelley, Chief, Investigations and Hearings Division, Enforcement
Bureau, Federal Communications Commission, 445 12th Street, S.W,
Room 3-B443, Washington DC 20554 and MUST INCLUDE the file number
listed above. 16. IT IS FURTHER ORDERED that a copy of this Notice shall
be sent, by Certified Mail/Return Receipt Requested, to AMFM's
counsel, Eric L. Bernthal, Esq., Latham & Watkins, 1001
Pennsylvania Avenue, N.W., Suite 1300, Washington, DC 20004-2505.
FEDERAL COMMUNICATIONS COMMISSION
David H. Solomon
Chief, Enforcement Bureau
_________________________
1 Chancellor is now named AMFM, Inc. Since the corporation was
known as Chancellor during the time of the events in question, we
will refer to the corporation as Chancellor.
2 The Commission's Forfeiture Policy Statement and Amendment of
Section 1.80 of the Commission's Rules, 12 FCC Rcd 17087, 17114
(1997), recon. denied 15 FCC Rcd 303 (1999); 47 C.F.R. § 1.80(b).
3 47 C.F.R. §§ 0.111, 0.311 and 1.80.