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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 ) In the Matter of Liability of ) ) MAX TELEVISION OF TRI-CITIES L.P.) ) Licensee of Television Station ) WEMT(TV), Greenville, Tennessee ) ) for a Forfeiture ) MEMORANDUM OPINION AND ORDER Adopted: May 4, 1999 Released: May 6, 1999 By the Chief, Mass Media Bureau: 1. The Commission, by the Chief, Mass Media Bureau, acting pursuant to authority delegated by Section 0.283 of the Commission's Rules, 47 C.F.R.  0.283, has before it for consideration the following documents: (1) a Notice of Apparent Liability (NAL) for forfeiture in the amount of ten thousand dollars ($10,000) issued against Max Television of Tri-Cities L.P. (Max Television), licensee of station WEMT(TV), Greenville, Tennessee, for that station's apparent repeated violation of Section 73.670 of the Commission's Rules, 47 C.F.R. 73.670, which limits the amount of commercial matter that may be aired during children's programming; and (2) Max Television's request for reduction of the forfeiture filed on September 8, 1997 (Request). 2. By way of background, in the Children's Television Act of 1990, Congress directed the Commission to adopt rules, inter alia, limiting the amount of commercial matter that television stations may air during children's programming, and to consider in its review of television license renewals the extent to which the licensee has complied with such commercial limits. Accordingly, 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 on weekends and 12 minutes on weekdays. The Commission also reaffirmed and clarified its long-standing policy 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"). These commercial limitations became effective on January 1, 1992. 3. On April 1, 1997, Max Television filed an application to renew its license for station WEMT(TV) (File No. BRCT-970401KL). In response to Section III, Question 4 of that application, Max Television certified that, during the previous license term, station WEMT(TV) had not complied with the limits on commercial matter in children's programming specified in Section 73.670 of the Commissions Rules. Therefore, in accordance with Question 4, Max Television submitted an exhibit to the application in which it indicated that, between March 19, 1994, and January 28, 1995, station WEMT(TV) exceeded the children's television commercial limits on 30 occasions. Of these overages, one was 10 seconds in duration, nine were 30 seconds in duration, two were one minute in duration, one was one minute and ten seconds in duration, three were one minute and 30 seconds in duration, four were two minutes in duration, four were two minutes and 30 seconds in duration, two were three minutes in duration, three were three minutes and 30 seconds in duration and one was a program- length commercial. Max Television also offered explanations for the violations, asserting that all of the conventional overages "were the direct result of a single mistake" made by a station employee who filled the breaks between children's programs with commercial matter rather than "station identification and promotion of other programming." As for the program-length commercial, Max Television claimed that it occurred when station WEMT(TV) aired "Tazmania," a program supplied by the Fox Television Network, which contained a commercial announcement for a breakfast cereal featuring the program's character, "Taz." Max Television asserted, moreover, that station WEMT(TV) and the Fox Television Network had implemented policies and procedures to prevent future violations. 4. In WEMT(TV) NAL, we found that station WEMT(TV)'s record of exceeding the Commission's commercial limits on 30 occasions during its last license term constituted a repeated violation of Section 73.670 of the Commission's Rules. Accordingly, pursuant to Section 503(b) of the Communications Act of 1934, as amended, 47 U.S.C.  503(b), Max Television was advised of its apparent liability for forfeiture in the amount of $10,000. That amount was reached after consideration of the factors set forth in Section 503(b)(2) of the Communications Act, and, in particular, the five criteria consisting of: (1) the number of instances of commercial overages; (2) the length of each overage, the period of time over which the overages occurred; (4) whether or not the licensee established an effective program to ensure compliance; and (5) the specific reasons that the licensee gave for the overages. Applying these criteria to the facts of station WEMT(TV)'s case, we stated that not only was the total number of violations high, but that 19 of the commercial overages were one minute or longer in duration and one was a program-length commercial. Given this number and the nature of station WEMT(TV)'s overages, we concluded that children had been subjected to commercial matter greatly in excess of the limits contemplated by Congress when it enacted the Children's Television Act of 1990. In addition, we rejected Max Television's reasons for the violations - human error, inadvertence and the inclusion of program-related commercial matter in programming supplied to the station by a television network - as a basis for excusing station WEMT(TV)'s violations of the commercial limits. We further stated that, though station WEMT(TV) and/or the Fox Television Network implemented a plan to prevent future violations of the children's television commercial limitations, this did not relieve Max Television of liability for the violations which had occurred. 5. In its Request, Max Television reiterates the reasons for the violations which were cited in station WEMT(TV)'s renewal application. In particular, Max Television explains that station WEMT(TV)'s use of "spot checks" to ascertain compliance with the Commission's Rules and regulations failed to uncover the single mistake, a formatting error, which consequently perpetuated and caused repeated violations of the commercial limits. Further, Max Television contends that, although it does not excuse station WEMT(TV)'s performance, few children were actually subjected to excess commercial matter. This is so, Max Television maintains, because: (1) the single mistake which caused all of the conventional overages was limited to Saturday mornings, and all but one of those overages accord between 6:00 a.m. and 8:00 a.m.; and (2) of the 29 hours that contained excess commercials, 23 of them had a rating of one or less. According to Max Television, moreover, station WEMT(TV) "in no way profited from the commercial overages," but instead cost the station "a great deal of money due to underreporting of inventory in other more valuable areas of children's programming." In addition, Max Television states that station WEMT(TV) has gone to great lengths to ensure that such a mistake never occurs again, and strives to comply with all of the Commission's Rules and regulations. Along this line, Max Television maintains that a licensee's history of overall compliance with the Commission's Rules and regulations has previously been held as a reason to reduce a forfeiture. To wit, Max Television concludes that its overall history of compliance, combined with its voluntary disclosure of station WEMT(TV)'s "one error which multiplied into `repeated violations,'" are sufficient reasons to justify a reduction of the assessed forfeiture. DISCUSSION 6. We disagree with Max Television. Preliminarily, we note that the forfeiture assessed against Max Television had less to do with the number of errors which caused the violations of the children's television commercial limits, and more to do with the failure of station WEMT(TV)'s compliance program to detect the 29 violations until ten months after the formatting error responsible for these violations occurred. Such failure demonstrates the lack of an effective compliance program at station WEMT(TV) at the time the commercial overages occurred. It is, in fact, the efficacy of a licensee's compliance program, not the mere presence of a program, that we look to when assessing a forfeiture for violations of the commercial limits. In this regard, it was the deficiencies in Max Television's compliance program that we recognized in WEMT(TV) NAL when we stated that "[a]lthough WEMT(TV) appears to have made some effort to comply with the Commission's children's television commercial limits, it is apparent that the station's effort was not sufficient to ensure compliance in view of the fact that the 29 conventional overages began in April, 1994, and were not detected until January, 1995." In WEMT(TV) NAL, because we considered whether Max Television established an effective compliance program in determining the forfeiture amount at issue, we acted appropriately and in a manner consistent with Commission precedent. Furthermore, we mention here, as we did in WEMT(TV), the Commission's expectation that, in delaying the effective date of Section 73.670, broadcasters and cable operators would have additional time within which to hone their plans to ensure compliance with the commercial limits. The fact that, even with the benefit of that additional time, Max Television's program at station WEMT(TV) had shortcomings which resulted in a high number of violations at that station does not warrant a reduction in the forfeiture amount. Nor do we believe that Max Television's implementation of procedures to prevent future violations ten months after discovering a pattern of 29 commercial overages is the kind of measure which warrants a reduction of forfeiture. 7. Voluntary Disclosure. With respect to Max Television's contention that the forfeiture should be reduced based on its voluntary disclosure of the violations, we note that in the Children's Television Act of 1990, Congress not only required the establishment of limits on the amount of commercial matter that may be included in children's television programming, but also directed that "the Commission shall, in its review of any application for renewal of a commercial . . . television broadcast license, consider the extent to which the licensee . . . has complied with such standards . . . ." Pursuant to this Congressional mandate, the Commission revised FCC Form 303-S, Application for Renewal of License, to direct the applicant to: (i) state whether or not it had complied with the children's television commercial limits; and (ii) if it had not so complied, submit an exhibit to the renewal application listing "each segment of programming, 5 minutes or more in duration, designed for children 12 years old and under and broadcast during the license period which contained commercial matter in excess of the limits" (emphasis added), including "the length of the segment, the amount of commercial matter contained therein, and an explanation of why the limits were exceeded." Section 73.3514 of the Commission's Rules, 47 C.F.R.  73.3514, provides that "[e]ach application shall include all information called for by the particular form on which the application is required to be filed . . . ." Moreover, Section 1.17 of the Commission's Rules, 47 C.F.R.  1.17, provides that "[n]o licensee, permittee or applicant shall . . . in any application . . . submitted to the Commission, make any material misrepresentation or willful material omission bearing on any matter within the jurisdiction of the Commission." 8. Failure to provide the information called for in the renewal application, or providing incomplete or incorrect information, could have resulted in an additional forfeiture against Max Television for violation of Section 1.17 of the Commission's Rules. Further, failure to disclose the occurrence of violations of the children's television commercial limitations in response to Question 4(b) and (c) in the renewal application, or providing incomplete or incorrect information, could constitute a misrepresentation or lack of candor by the applicant, which would raise a serious question as to whether the applicant possesses the character qualifications to be a Commission licensee. Applicants for license renewal have been disqualified on the basis of such character issues, resulting in denial of renewal. 9. Finally, as each applicant is reminded by a statement directly under the signature block on the FCC Form 303-S renewal application, willful false statements in the renewal application are punishable by fine and imprisonment, pursuant to U.S. Code, Title 18, Section 1001. In view of the foregoing, Max Television's provision of information regarding the nature and extent of its noncompliance with the children's television commercial limits, which it was explicitly required to provide pursuant to specific questions in the renewal application, cannot be said to have been "voluntary." 10. History of Overall Compliance. Next, we consider Max Television's assertion concerning its overall compliance with all other Commission Rules and regulations. Initially, we note that Section 503 of the Communications Act affords the Commission a great deal of discretion in determining forfeiture amounts. Further, while Section 503(b)(2) of the Communications Act requires us to consider a licensee's history of prior offenses in determining a forfeiture amount, it does not mandate that we mitigate a forfeiture amount should the licensee have no history of prior offenses. A licensee's compliance history must be considered along with the other factors set forth in Section 503(b)(2), namely, but not limited to, the number and duration of the commercial overages, the period of time over which they occurred and whether the licensee had established an effective compliance program. Based on the facts and circumstances of the instant case, we believe that, on balance, Max Television's overall history of compliance with the Commission's Rules neither necessitates nor justifies a reduction of the specified forfeiture amount. Given the high number of total overage at issue, the duration of those overages, see supra  3, the extended ten-month period over which they occurred without detection and the deficiency in Max Televisions compliance program, it was within our discretion to determine that a forfeiture in the amount of $10,000 was appropriate for station WEMT(TV)'s violations of the children's television commercial limits. 11. For these reasons, given the totality of the facts and circumstances in the instant case, we conclude that the arguments contained in Max Television's Request do not warrant a reduction of the $10,000 forfeiture assessed in Max Television of Tri-Cities L.P. (WEMT(TV)), 12 FCC Rcd 11988 (MMB 1997). 12. Accordingly, IT IS ORDERED THAT Max Television of Tri-Cities L.P.'s request for reduction of the forfeiture assessed in Max Television of Tri-Cities L.P. (WEMT(TV)), 12 FCC Rcd 11988 (MMB 1997) IS DENIED. 13. IT IS FURTHER ORDERED THAT, pursuant to Section 503(b) of the Communications Act of 1934, as amended, 47 U.S.C.  503(b), Max Television of Tri-Cities L.P., licensee of station WEMT(TV), Greenville, Tennessee, FORFEIT to the United States the sum of ten thousand dollars ($10,000) for willful and repeated violations of Section 73.670 of the Commission's Rules, 47 C.F.R. 73.670. Payment of the forfeiture may be made by mailing to the Commission a check or similar instrument payable to the Federal Communications Commission. With regard to this forfeiture proceeding, Max Television of Tri-Cities L.P. may take any of the actions set forth in Section 1.80 of the Commission's Rules, 47 C.F.R.  1.80, as summarized in the attachment to this Memorandum Opinion and Order. FEDERAL COMMUNICATIONS COMMISSION Roy J. Stewart Chief, Mass Media Bureau cc: William M. Barnard, Esq.