On October 20, 2015, the FCC’s Enforcement Bureau entered into a Consent Decree with an Alaskan wireless carrier, imposing a $620,500 penalty on the carrier and resolving an investigation into non-compliance with the FCC’s antenna structure and registration requirements. 

Antenna Structure Registration and Rules.  The FCC and the FAA regulate towers and other antenna structures to help prevent towers from creating hazards for airplanes.  FCC rules require towers exceeding 200 feet above ground level or requiring “special aeronautical study” to be registered with the FCC and painted and lit according to FAA standards.  (Towers requiring “special aeronautical study” are generally those that are near airports.)  Tower owners must also monitor and periodically inspect tower lighting systems, report lighting outages to the FAA immediately, and repair lighting outages “as soon as practicable.”

Investigation and Consent Decree.  In 2013, the carrier and another entity merged their spectrum licenses and wireless antenna structures into a jointly owned subsidiary.  The carrier later bought out the other entity’s interest in the subsidiary, which then became a wholly-owned subsidiary of the carrier.  Following that transaction, the carrier conducted an internal inventory of the subsidiary’s antenna structures and discovered numerous violations of FCC rules, including several unregistered structures and several structures that were not properly lit. 

The carrier self-reported these violations to the FCC, and the FCC’s Enforcement Bureau began an investigation of its own.  The Consent Decree concludes the bureau’s investigation, requires that the carrier pay a $620,500 penalty, and obligates the company to develop and implement a compliance plan to ensure future compliance with the Communications Act, FCC rules, and the Consent Decree.

Key Take-Aways.  This Consent Decree serves up a couple important lessons.  First, the FCC actively enforces the antenna structure rules, often imposing significant penalties for non-compliance, even for companies that self-report violations.  Prudent tower owners maintain documented compliance plans, periodically inspect towers and review compliance with the rules, and consult with their legal advisors about any compliance issues or uncertainty.  Second, it underscores the importance of conducting thorough due diligence before a planned merger or acquisition and crafting appropriate remedies and indemnification provisions to cover buyers after closing for pre-existing non-compliance.

If you have any questions about antenna structure rules, please contact Jake Baldwin at (312) 372-3930 or jbaldwin@cinnamonmueller.com.

FCC Selects MVPDs for EEO Audits

On October 14, 2015, the Media Bureau released a Public Notice identifying certain multichannel video programming distributors (“MVPDs”) that they had been randomly selected for annual Equal Employment Opportunity (“EEO”) audits.  The Public Notice lists the MVPDs selected.  Responses are due to the FCC by November 25, 2015.

The FCC annually audits about five percent of MVPD employment units for compliance with cable EEO rules.  The audit letter requests certain data from the selected MVPD employment units, including the unit’s most recent EEO public file (which is required to be placed on the MVPD’s website), information on job openings, and documentation demonstrating performance of the required recruitment initiatives.

All selected MVPD employment units must respond to the audit letter, but employment units with fewer than six full-time employees have more limited response requirements. 

Failing to timely respond to the audit letter could result in a certification that the employment unit is not in compliance for 2015 with the FCC’s EEO rules, which may put an affected operator in violation of debt covenants or franchise requirements. 

If you have any questions about EEO compliance, please contact Scott Friedman at (312) 372-3930 or sfriedman@cinnamonmueller.com.