FCC Proposes Fining Sinclair for Not Saying Programs Are Ads

(Bloomberg) -- The U.S. Federal Communications Commission proposed fining Sinclair Broadcast Group Inc. $13.4 million for programming that appeared more than 1,700 times without disclaimers telling viewers the messages were sponsored by another business.

Sinclair, which has nearly 200 stations and wants to buy Tribune Media Co. stations in 33 markets, broadcast the programming for the Huntsman Cancer Foundation, according to an FCC news release issued on Thursday. The spots appeared on 64 Sinclair stations and 13 non-Sinclair stations, the FCC said.

TV stations need to tell the public when they’re airing sponsored material so consumers know who’s trying to persuade them.

Sinclair said it would fight the fine. “Any absence of sponsorship identification in these public service segments was unintended and a result of simple human error,” the company said in an emailed statement.

The FCC’s action “is unreasonable, given the circumstances of our case and the absence of any viewer harm,” Sinclair said. “We disagree with the FCC’s action and intend to contest this unwarranted fine.”

Agency Democrats dissented, arguing that Sinclair should face a heavier penalty.

“The ‘punishment does not fit the crime’ against a company that grossed more than
$2.7 billion in revenue last year,” Commissioner Mignon Clyburn said in a written dissent.

Chairman Ajit Pai, a Republican, defended the penalty sought and said it is “more than three times any penalty that has ever been imposed for violating our sponsorship identification rule.”

The programming promoted the foundation and the Huntsman Cancer Institute, and included 60- to 90-second sponsored stories made to look like independently generated news coverage and 30-minute paid television programs, the FCC said in its news release. The agency investigated after receiving an anonymous tip, it said.

Sinclair will have 30 days to respond to the FCC. Another order imposing a fine or any settlement would require a commission vote.

©2017 Bloomberg L.P.