FCC Fines Another Radio Station For Not Broadcasting Relevant Contest Rules

FCC Fines Another Radio Station For Not Broadcasting Relevant Contest Rules

by Jerry Glover
September 12, 2012

On August 28, 2012, we reported an FCC decision that fined a radio station for failing to conduct a “cute baby” contest as described in its broadcasts. On September 7, the FCC again fined another radio station $4,000 for failing to broadcast changes to prizes being offered in an over-the-air contest. In re Good Karma Broadcasting, LLC (Station WKNR(AM)/Cleveland, Ohio, No. EB-09-IH-0756.

Station WKNR broadcast a daily show called “Really Big Show.” One segment of the show was entitled “Who Said That?.” The station would play an audio clip of a sports figure saying something and listeners would call in or send the station an e-mail and guess the identity of the mystery sports figure. The station broadcast that it would award prizes to those who correctly identified the speaker. After one speaker was correctly identified, the station would then continue the contest with a different speaker and audio clip. The last audio clip was aired in 2007. The speaker went unidentified for 20 months. During that period of time, the station broadcast daily of additional prizes added each week for the winner. The station, however, did not broadcast the entire prize list but only identified new and “material” prizes. The station stopped announcing prizes after that 20 months period unless a listener tried to guess the name of the speaker. In addition, some announced prizes became unavailable (e.g., tickets to a sporting event that was held before a winner came forward). The station did not announce these changes to the prize list. The station claimed that it would have offered a similar prize of similar value had someone correctly identified the speaker. No such broadcast to that effect was ever made.

In response to a listener complaint to the FCC, WKNR argued the following: (i) the show as not a contest but a program feature or “bit”; therefore, the show was not subject to the FCC’s contest rules; (ii) even if the show was a contest, the station substantially conducted the contest in compliance with the FCC contest rules; (iii) any violations of the contest rule were, at most, technical and no action beyond an admonition was warranted.

The FCC contest rule, 47 C.F.R. Section 73.1216 states: “A licensee that broadcast or advertises information about a contest it conducts shall fully and accurately disclose the material terms of the contest, and shall conduct the contest substantially as announced or advertised. No contest description shall be false, misleading or deceptive with respect to any material term.” A “material term” includes the extent, nature and value of prizes. Id. The station must broadcast the material terms of a contest at the onset of the contest and continually thereafter while the contest entry period is open. The station has discretion as to the number of times and the manner of disclosing the contest’s material terms. The station cannot rely on posting contest rules on its website to comply with the FCC contest rule; only what is broadcast counts.

The FCC disagreed with the station’s argument that the show was not a contest. The Commission noted that a contest is defined as “a scheme in which a prize is offered or awarded, based upon chance, diligence, knowledge or skill, to members of the public.” Id. Since the station offered and awarded prizes to its listeners who recognized the speaker in audio clips broadcast by the station, the promotion was a contest.

The Commission also found that the station had not broadcast a reasonable number of announcements about the contest noting that the number of those announcements decreased over the life of the contest, especially during the 20 month period before anyone recognized the speaker in the last audio clip broadcast. During that 20 month period the only “announcement” occurred if a listener called in to guess the identity of the speaker.

Finally the Commission noted that the station was required to broadcast a list of prizes (especially if prizes changed during the course of the contest) and to note specifically that the station could substitute prizes of equal value for those announced on-air. The Commission rejected the station’s argument that prizes with low monetary values could be excluded from the broadcast of a prize list otherwise. How, the Commission asked, could listeners know if the station eventually awarded all prizes if the entire prize list is not broadcast?

In addition to concluding that the station had to broadcast that it had the right to substitute prizes of equal value, the Commission also held that the on-line rules noting that the station had this right of substitution did not take the place of the broadcast requirement.

AN AFTERTHOUGHT: Perhaps the station could have avoided the problems it faced with this contest if it had set a deadline for identifying each new mystery speaker. A deadline would have saved the station the need to continue broadcasting information about the contest over the 20-month period required to find a winner for the last mystery speaker.

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