Wouldn’t it be great if a station planning a live broadcast could plan to pin the blame on the bleeper if necessary? However, while it is possible for a network or a station to include language in a contract with featured talent that would hold the talent responsible for any acts of indecency committed, ultimately, it wouldn’t matter – the FCC is still going to go after the licensee, who is responsible for policing its own air. The talent and, for the most part, the network, are both off the hook. Attorney John M. Pelkey of Garvey Schubert Barer told RBR-TVBR:
“NBC could have included an indemnification provision in its contract with the ‘talent’ so that the talent became obligated to hold NBC harmless for any damages, including any FCC fines, suffered by NBC as a result of the talent’s conduct,” said Pelkey. “Such indemnification obligations are routinely included in LMAs so that the programmer must indemnify the licensee if there is anything in the programmer’s programming that results in an FCC fine.”
Pelkey continued, “Unfortunately, however, that type of provision would not get NBC (or any FCC licensee that carried the ‘flip-off’) off the hook. The licensees, including the NBC O&Os, who carried the offensive programming would continue to be the parties to whom the Commission would look if a fine were to be paid. After all, it is the licensee’s responsibility to police whatever goes out over its station’s airwaves. And, as a practical matter, it is much easier for the Commission to take action against a licensee than it is to try to take action against the talent.
“So, if the FCC were to decide to impose a forfeiture (Commission speak for a fine), the forfeiture would be levied against the licensees. Once that forfeiture is issued, NBC and any other party that has the right to indemnification by the talent could seek to enforce that right. That process could prove to be cumbersome, time-consuming and expensive, however, and may not be particularly effective if the talent does not have the assets to follow through on his, her or its indemnifications obligations.”
Pelkey concluded, “So, as much as NBC might have wanted to shift all responsibility to the talent, the unfortunate fact is that NBC could not have included contractual provisions that would have taken it and its affiliates out of the loop and made the talent directly responsible. The most that could have been done would have been to include a provision requiring the talent to pay NBC and its affiliates for any damages suffered by them as the result of the talent’s on-air conduct.”
As for the liability of the network, the key fact is that it is not a licensee, and therefore it is at risk only for the licenses in its possession, or in other words, its owned-and-operated stations.
But there is precedent for FCC action against a network. Pelkey explained, “The Commission’s policy is to impose fines against licensees, not networks, for indecent programming. Nevertheless, networks can still find themselves the subject of an indecency investigation as a network if they are also directly or indirectly licensees. In the ‘American Dad’ case from nearly two years ago, the Commission asked for information from Fox regarding not only the Fox O&Os, but also regarding any affiliates who were under contract to carry the program that was the subject of the complaints. Fox refused to provide the requested information. The Commission fined Fox and held that Fox was obligated to provide the requested information not only with respect to its O&Os, but also with respect to its affiliates. So, Fox found itself caught in the investigation not just because it was a licensee, but also in its role as a network. When it comes to imposing fines for the programming itself, however, the Commission only goes after the licensees, not the networks. “