David Oxenford

By: David Oxenford, Wilkinson Barker Knauer

The full Commission this week issued an Order fining Cumulus Media $26,000 for its failure to upload one EEO Annual Public File Report to its online public inspection file until about 9 months after the due date.  The unanimous decision of the five Commissioners generally upheld an EEO Notice of Apparent Liability, issued unanimously by all four FCC Commissioners about two years ago, where the Commission had proposed a $32,000 fine on the company for its failure to timely upload the annual EEO report for a cluster of five co-owned stations in a Georgia market (and the fact that a link to that report on each stations’ website was also missing for that period).  The principal change in this week’s decision was to reduce the fine that had been proposed by $6,000, reflecting the amount that the Notice of Apparent Liability had assessed for the licensee’s failure to self-assess its EEO program. Broadcasters are required to regularly assess the effectiveness of their EEO program.  The proposed fine was imposed on the theory that, if the licensee had been regularly assessing its program, it would have noted that the required report had not made it to the online public file and fixed that problem.  This week’s decision reaffirms that reasoning but reduces the fine by the amount allocated to the failure to self-assess the program, finding that Cumulus may not have had notice that reviewing public file uploads was part of the obligation to self-assess.

It is very important to note that this decision did not cite any failure by the licensee to recruit widely when it had open positions, nor any failure of the group to conduct the required EEO non-vacancy specific outreach (these obligations described in our posts here and here).  The alleged violations cited in the decision were simply tied to the failure to upload the annual report.  In fact, Cumulus stated that the report was prepared on time, but was not uploaded to the public file because of an administrative oversight due to staff turnover.  While the base fine for this violation totaled less than $10,000, the proposed fine was increased because Cumulus was found to have previous FCC rule violations for EEO and sponsorship identification matters.  Both Cumulus and the NAB argued that this amount was excessive for a single instance of a paperwork shortcoming – the FCC rejecting that reasoning, finding that the upload was a critical part of the broadcaster’s EEO obligations as it gives the public a way to monitor the performance of the licensee.

The licensee also argued that its past violations should not have been used against it to justify an increase in the base amount of the fine, as there had been a change of control since the prior violations (caused by the Company’s bankruptcy).  The FCC also rejected that argument as the licensee remained the same, even if control of the company had changed.  This is generally consistent with past precedent (see our post here on the rejection of a similar argument), and the FCC rejected Cumulus’ reliance on past decisions of its staff where the FCC had not imposed an upward adjustment based on past violations that occurred before a transfer of control (the FCC finding that it was not bound by these decisions of its Media Bureau – it can overrule that precedent and is bound only by full Commission decisions).

This case shows the continuing importance that the FCC places on EEO enforcement.  As we have noted before (see our posts here and here), the Commissioners are currently considering a proposal for greater EEO enforcement, including the return of FCC Form 395-B (which broadcasters would file annually to report on the race and gender of each of their employees) and other enhancements to their current EEO program.  Watch for that decision to be released, which we are expecting soon.  And be sure that your stations follow to the letter the FCC’s EEO requirements in order to avoid the kinds of penalties imposed here on Cumulus.

David Oxenford is MAB’s Washington Legal Counsel and provides members with answers to their legal questions with the MAB Legal Hotline. Access information here. (Members only access). There are no additional costs for the call; the advice is free as part of your MAB membership.