In Re Complaints of NATIONAL WELFARE RIGHTS ORGANIZATION, against GILMORE BROADCASTING CORP., LICENSEE OF STATION WSVA-TV, HARRISONBURG, VA.; AMERICAN ACADEMY OF PEDIATRICS, and CIBA PHARMACEUTICAL CO.
FEDERAL COMMUNICATIONS COMMISSION
41 F.C.C.2d 187
RELEASE-NUMBER: FCC 73-596
June 8, 1973 Released
BY THE COMMISSION: COMMISSIONER JOHNSON DISSENTING AND ISSUING A STATEMENT; COMMISSIONER HOOKS CONCURRING AND ISSUING A STATEMENT.
[*187] 1. The Commission has before it a complaint filed by the National Welfare Rights Organization (NWRO) against Gilmore Broadcasting Corporation (Gilmore), licensee of Station WSVA-TV, Harrisonburg, Virginia; the American Academy of Pediatrics (AAP), and the Ciba Pharmaceutical Company (Ciba) n1, and responses filed by Gilmore and AAP. A reply to the responses was filed by the complainant.
n1 The Commission's regulatory authority does not, of course, extend to AAP and Ciba, but as well be noted hereinafter, their actions are related to the complainant's allegations of violations of Section 508 of the Communications Act.
2. The National Welfare Rights Organization states that it is a voluntary association in 50 states organized to represent the interests of low-income persons and particularly welfare recipients, and that as complainant in this case it represents the interests of its members who are parents of school-aged children and are concerned about drug abuse. The complaint alleges that required sponsorship identification was omitted from a public service announcement. The announcement was distributed under the aegis of the American Academy of Pediatrics, which states it is a non-profit corporation consisting of 10,000 certified pediatricians. Production of the announcement was financed by the Ciba Pharmaceutical Company. National Television News (NTN) produced the filmed announcement for AAP. It was sent to some 500 TV stations and apparently was broadcast by many, one of which was WSVA-TV, Harrisonburg, Virginia. n2 The film was [*188] shown on WSVA-TV seven times between mid-December 1971 and mid-February 1972.
n2 Originally, NWRO also complained against WTAR-TV, Norfolk, Virginia, but withdrew its complaint against that station upon notification by the licensee that WTAR-TV never broadcast the announcement.
3. The film dealt with the subject of hyperactivity in children, and advocated "Sensitive care, remedial education, and in some cases the use of medication" to alleviate this condition. The announcement consisted of a one-minute color film and depicted a child, first bouncing on a bed and playing with toys and then becoming destructive. In the second sequence the child was shown in a classroom, unable to pay attention and disrupting the activities of other students. The narration was a follows:
Everyone should unwind once in a while... but six-year-old Joey can't unwind. He's driven by an insatiable desire to be constantly moving. He can't focus his attention on a single subject for long. As a result, his attempts at normal play usually end in frustration. In school, Joey's inability to concentrate makes is difficult for him to learn... and his restless behavior disrupts the activities of the other children. Joey is just one of an estimated two million youngsters who suffer from hyperactivity. Early recognition can lead to effective management of this condition. Sensitive care, remedial education, and in some cases the use of medication, can help most of these children avoid serious emotional or behavior problems. All healthy children are active... but if your child shows symptoms of hyperactivity, consult your doctor.
The announcement ended with the statement that it was "presented as a public service announcement by the American Academy of Pediatrics."
4. Ciba is the producer of the drug Ritalin, which is frequently prescribed for the treatment of hyperactivity. In December 1970 Ciba received a letter from AAP asking if it would help to fund a series of TV announcements designed to educate the public on child health problems. The films were to be produced by NTN. In February 1971 Ciba received a letter from NTN outlining different lengths and types of announcements that could be produced and stating the production cost of each. Ciba then suggested the subject of hyperactivity for the announcement it would fund, and AAP accepted the suggestion. At the request of NTN, Ciba also provided research material on the subject of hyperactivity. NTN prepared a proposed script which included the reference to medication that appeared in the final version, and sent it to Ciba for review. Ciba made one suggestion of substance, not regarding medication but rather, the addition of "remedial education" as one method of alleviating hyperactivity. The AAP Committees on Public Information and on School Health and the Executive Director of AAP then reviewed the script and approved it. Ciba saw the film in rough form, but made no further suggestions. Ciba sent AAP the required sum to pay for the actual cost of production of the film. AAP, Ciba and NTN all deny that there were any agreements or understandings between Ciba and either AAP or NTN concerning any mention of treatment by means of medication. Ciba had financed no public service announcements prior to this one.
5. WSVA-TV received the script and the film on an unsolicited basis from NTN, which distributed them for AAP. Mrs. Diane Plum, Public Service and Promotion Co-ordinator for the station, pre-viewed the film to assure that it contained no commercial content. WSVA-TV [*189] states that in its opinion "the message, if subjected to a reasonable interpretation, is nothing more than a bona fide and public spirited attempt to acquaint parents with the general problem of hyperactivity in children." WSVA-TV was not informed that Ciba had funded the announcement, and it was unaware of the details of production, other than it had been produced by NTN on behalf of AAP.
SUMMARY OF PLEADINGS
6. NWRO asserts that the AAP identification in the announcement does not adequately inform the public of Ciba's involvement and interest in the film; that the broadcast of the announcement violates Sections 317 and 508 of the Communications Act of 1934, as amended, which relate to disclosure of payment for the broadcast of matter, and that WSVA-TV is therefore subject to sanctions by the Commission. NWRO contends that because Ciba financed the production of the announcement, it should have been identified as the sponsor pursuant to the Commission's sponsorship identification requirements, and that AAP violated Sections 508(b) and (c) in failing to disclose to WSVA information as to consideration paid for the "inclusion of any matter as a part of all of the announcement" because Ciba's financing constituted such consideration.
7. AAP and NTN, in a joint response, assert that there was no violation of Section 317 or 508; that Ciba paid no money or other consideration for the inclusion of any matter in the program because there was no understanding with Ciba concerning any mention of treatment with drugs or any other part of the content of the announcement and because the committees of AAP and its Executive Director were solely responsible for control of content and for review and final approval of the announcement. AAP and NTN further state that neither was paid any money beyond the actual cost of production, neither received any service or property, and that the word "medication" as used in the announcement was reasonably related to the legitimate educational use of the film. They maintain that the examples set forth in Applicability of Sponsorship Identification Rules, 40 FCC 141 (1963) indicate no Congressional intent to require disclosure in a situation such as that presented here, and that examples where no disclosure is stated to be required include those of business enterprises which have assisted in the production of a program by providing recordings, film material or other services but where no additional payment has been made to the broadcast station or program producer for inclusion of the material or for any reference to the business enterprise or its products beyond what is "reasonably related to the use of such service or property" in the program. AAP and NTN also cite Sections 317(a)(1) and 508(f) of the Act in support of their position.
8. In this regard Gilmore (WSVA-TV) argues that the requirement of an announcement under Section 508 does not apply to those who, like Ciba, underwrite production costs of public service announcements for non-profit organizations such as AAP. In support of this assertion, the licensee cites the Commission's Report and Order of [*190] May 1, 1963, 34 FCC 829, and its Applicability of Sponsorship Identification Rules, supra, Examples 10-21 and 26. Example 26 is as follows:
(a) A bus company prepares a scenic travel film which it furnishes free to broadcast stations. No mention is made in the firm of the company or its buses. No announcement is required because there is no payment other than the matter furnished for broadcast and there is no mention of the bus company.
(b) Same situation as in (a), except that the bus, clearly identifiable as that of the bus company which supplied the film, is shown fleetingly in highway views in a manner reasonably related to that travel program. No announcement is required.
(c) Same situation as in (a), except that the bus, clearly identifiable as that of the bus company which supplied the film, is shown to an extent disproportionate to the subject matter of the film. An announcement is required, because in this case by the use of the film the broadcaster has impliedly agreed to broadcast an identification beyond that reasonably related to the subject matter of the film.
9. NWRO submits that WSVA-TV violated Section 317(c) of the Act by not fulfilling its responsibility to use "reasonable diligence" to obtain information from the AAP or NTN regarding Ciba's role in financing the film. NWRO states that part of the reasonable diligence required of stations under Commission regulations includes a duty to have a sponsorship announcement that "fully and fairly discloses the true identity of the person or persons by whom or in whose behalf (such) payments are made or promised." n3
n3 Section 73.654(f) in its entirety reads:
The announcement required by this section shall fully and fairly disclose the true identity of the person or persons by whom or in whose behalf such payment is made or promised, or from whom or in whose behalf such services or other valuable consideration is received, or by whom the material or services referred to in paragraph (d) of this section are furnished. Where an agent or other person contracts or otherwise makes arrangements with a station on behalf of another, and such fact is known to the station, the announcement shall disclose the identity of the person or persons in whose behalf such agent is acting instead of the name of such agent.
10. In response, Gilmore states that it did not violate Section 317(c) of the Act, and that this section was not intended to impose absolute liability on a licensee who unknowingly broadcasts programming material without a proper sponsorship identification as a result of the failure of others to provide it with information required by Section 508. In this regard the licensee cites former Commission Chairman Frederick Ford's statement in the U.S. Code Congressional and Administrative News (H.R. Rep. No. 1800, 86th Cong., 2nd Sess., 3539, (1960)):
Subsection (c) of the proposed Section 317 would require station licensees to exercise reasonable diligence to obtain from its employees and others information to enable the licensee to make appropriate announcement of sponsorship. The term 'reasonable diligence" is appropriate in the circumstances, since it would require the licensee to take appropriate steps to secure such information, but it would not place a licensee in the position of being an insurer, nor does this condition permit a licensee to escape responsibility for sponsorship announcements by inactivity on his part. We believe that the term 'reasonable diligence' has a sufficiently accepted legal meaning so as to permit the Commission to apply this standard in given factual situations.
The NWRO emphasizes, however, that the Chairman did say that "reasonable diligence does require the licensee to take appropriate steps to secure such information as to enable it to make an appropriate announcement of sponsorship."
[*191] 11. The licensee argues that WSVA-TV satisfied the reasonable diligence requirement when Mrs. Plum, its station's Public Service and Promotion Coordinator, pre-screened the film, since it had no knowledge that production costs had been paid by Ciba. To this argument, the NWRO responds that Mrs. Plum informed its representative in a telephone conversation in early March 1972, that when public service announcements financed by nonprofit organizations are sent out, the organization under whose name the spot is being distributed often informs the station in a cover letter who has financed the production of the spot. The NWRO submits that since station personnel admit that this is an "established practice," n4 any review of the film should have included an inquiry into the source of the financing as part of the station's duty of reasonable diligence, since it asserts that Mrs. Plum could easily have made an inquiry to AAP or NTN and discovered the source of the financing.
n4 NWRO has furnished no evidence, however, that it was an "established practice" for the station to receive or seek such information.
12. NWRO contends further that WSVA-TV violated Section 317(a)(2) of the Act, which, it states, "requires sponsorship identification in the broadcast of any material furnished without charge that discusses a controversial issue." NWRO asserts that the use of Ritalin and similar drugs for the treatment of hyperactivity presents a controversial issue. The complainant cites, In the Matter of Amendment of Sections 3.119, 3.289, 3.654, and 3.789 of the Commission's Rules, 34 FCC 829 at 847, 848, 25 RR 1575 at 1598 (1963) for the proposition, in NWRO's words, that,
With respect to political programs or programs involving the discussion of controversial issues, more frequent identification and greater specificity is required as to the true identity of those furnishing the program.
13. The licensee, and AAP and NTN reply that WSVA-TV did not violate Section 317(a)(2) because the announcement did not include a discussion of the merits of Ritaline or any controversial issue of public importance for which "any film, records, transcriptions, talent, scripts, or other material or service have been furnished an inducement to broadcast." They maintain that none of the materials covered by Section 317(a)(2) -- films, records, transcriptions, etc. -- were supplied by Ciba; that the pharmaceutical company's furnishing of medical research material on hyperactivity at the request of NTN did not constitute an "inducement to broadcast"; that, in any event, Section 317(a)(2) applies to the broadcast of a program containing a controversial issue of public importance and not to the production of such a program; that production is covered by Section 508 of the Act and there is no similar provision in Section 317. The AAP and NTN also refer to Healey v. FCC, 23 RR 2d 2175, 2182 (D.C. Cir., March 3, 1972) in which the Court held that the fact that a matter is newsworthy does not mean it is also a matter of public controversy. The Court recognized that a contrary decision under the fairness doctrine would "so inhibit television and radio as to destroy a good part of their public usefulness." The AAP and NTN further submit that Interpretation number 11 in the Commission's Applicability of [*192] Sponsorship Identification Rules, supra, at 146, is applicable to their argument:
News releases are furnished to a station by Government, business, labor and civic organizations, and private persons, with respect to their activities, and editorial comment therefrom is used on a program. No announcement is required.
14. In response, NWRO states that the controversial issue involved was not the use of Ritalin, but actually the use of medication on children who exhibit symptoms of hyperactivity. The complainant argues that the fact that medication is only one of several possible solutions to hyperactivity mentioned in the spot and the fact that Ritalin is not mentioned by name does not mean that the Commission cannot look beyond the words of the script to ascertain whether the spot involves the discussion of an issue of public controversy. In this regard, the NWRO states that the Commission ruled in the Esso case that a series of advertisements dealt with the Trans-Alaska pipeline controversy, even though the announcements never mentioned the pipeline. Esso, 30 FCC 2d 643 (1971); 31 FCC 2d 729 (1971), 32 FCC 2d 714 (1971).
15. NWRO also maintains that Ciba's furnishing of medical information to NTN constituted an inducement to broadcast; that interpretation number 11 in the Applicability of Sponsorship Identification Rules, supra, at 146 is not applicable; that NTN cannot be equated with a station, that unlike a station NTN is not required to make independent editorial decisions under the Communications Act; that it produces an announcement to meet the needs and desires of its clients; that it is not unthinkable that NTN's editorial judgment may have been affected by the knowledge that Ciba was paying the bill; that Section 317 of the Act pertains to both the broadcast and production of controversial issues; that to hold otherwise would destroy the utility of Section 317, and that although Ciba's role was technically in the production of the spot, the material it provided was obviously intended to be broadcast. NWRO also asserts that Ciba's financing of the production was in fact payment to production personnel and that according to the general statement preceding the specific examples of Part D of the Applicability of Sponsorship Identification Rules, supra, at 147, and a footnote to that part, an announcement is required by Commission regulations:
Part D: Where service or property is furnished free for use on or in connection with a program, with the agreement, express or implied, that there will be an identification beyond mere use of the service or property in the program.
Footnote 3: Of course in all these cases, if there is payment to the station or production personnel in consideration for the exposure, an announcement is required.
16. NWRO further alleges that WSVA-TV violated Section 73.654 (g) n5 of the Commission Rules which requires identification of any [*193] corporation which pays for programs other than those advertising commercial products or services, and that Ciba's role in the financing of the announcement clearly demands identification under this regulation.
n5 Section 73.654(g) states:
In the case of any program, other than a program advertising commercial products or services, which is sponsored, paid for, or furnished, either in whole or in part, or for which material or services referred to in paragraph (d) of this section are furnished, by a corporation, committee, association, or other unincorporated group, the announcement required by this section shall disclose the name of such corporation, committee, association, or other unincorporated group. In each such case the station shall require that a list of the chief executive officers or members of the executive committee or of the board of directors of the corporation, committee, association or other unincorporated group shall be made available for public inspection at the studios or general offices of one of the television broadcast stations carrying the program in each community in which the program is broadcast. Such lists shall be kept and made available for a period of 2 years.
17. AAP and NTN state however, that Sections 73.654(f) and (g) of the Commission's Rules were not meant to define any new situation in which identification must be made, but were merely implemental of the substantial provisions in Section 317 of the Act. In rebuttal, the complainant argues that these subsections confirm its view of the meaning of the statute precisely because they provide the Commission's contemporaneous interpretation of the statute's language.
18. NWRO concludes its complaint by alleging that the announcement encourages parents to request drugs for their highly active children, bringing increased pressure on physicians to prescribe Ritalin.
19. In response, AAP and NTN conclude that any identification of Ciba in the spot would have appeared to be an endorsement of Ciba and its products by AAP; that stations would not accept such public service announcements because commercial identification would create an air of commercialism; that the AAP has used its official newsletter to publicize the sources of its production funds; that without corporate funding the AAP would be unable to produce public service announcements; and that the text of the announcement is unobjectionable. Gilmore Broadcasting Corporation states that the spot constitutes nothing more than a bona fide and public spirited attempt to acquaint parents with the general problem of hyperactivity and that if the NWRO's allegations were found to be valid, licensees would be reluctant to carry any public service announcement not directly produced by them for fear that it would result in an inadvertent violation of the law.
20. In its reply, NWRO suggests that if the AAP felt that a sponsorship identification would have been detrimental to the effect of the announcement, it could have requested the Commission to waive the announcement requirement under 317(d), Letter to National Broadcasting Company and Young and Rubicam International, Inc., 34 FCC 2d 600, 24 RR 2d 1301 (1972), and that Ritalin, which is a major source of revenue for Ciba, is the most widely used drug for hyperactivity in children. Report of Ciba for Senate Judiciary Committee's Subcommittee to Investigate Juvenile Delinquency, August 6, 1971. Finally NWRO submits that Commission interpretations have not addressed themselves to the question whether industry financing of a public service announcement requires identification of an interested manufacturer as well as the nonprofit group.
DISCUSSION AND RULING
21. We shall deal first with the complainant's contention that AAP violated Sections 508(b) and (c) of the Act by failing to disclose to [*194] television stations in advance of the broadcast of the announcement that "any money, service or other valuable consideration" had been accepted "for the inclusion of any matter as a part of such program or program matter." NWRO asserts that in funding the production of the announcement Ciba paid money for the inclusion of matter in it and that in addition, the supplying of research material of NTN on hyperactivity constituted the furnishing of a service "in terms of medical information." As NWRO states, the Commission has not previously addressed itself to the situation here presented regarding the funding by private enterprise of a public service announcement. n6
n6 In Letter to NBC and Young and Rubicam, cited in par. 20, the Gulf Oil Corporation had paid for the air time in which the announcements were to be broadcast -- a substantially different situation from that presented here.
22. Section 508 was incorporated in the Communications Act of 1960 following disclosure in Congressional hearings of widespread payola practices in the broadcast field. The basic principle underlying this Section as well as Section 317 is that "listeners are entitled to know by whom they are being persuaded." Applicability of Sponsorship Identification Rules, supra, at p. 141. In the present case, the available evidence is that Ciba did not request or suggest the inclusion in the announcement of any reference to itself, its product Ritalin, or even "the use of medication" (which might involve use of its product), but did suggest initially that the announcement deal with hyperactivity, and later, after reviewing the script, suggested the addition of "remedial education" as one of the methods that could alleviate the problem of hyperactivity. AAP states that it controlled and assumed final responsibility for the content of the announcement; and AAP, Ciba and NTN state that there were no agreements or understandings between them that medication would be mentioned in the announcement.
23. The question is whether (i) the acceptance of Ciba's suggestion that hyperactivity be the subject of the announcement it funded, (ii) the submission of the script and rough-cut film to Ciba by NTN, (iii) the acceptance of Ciba's suggestion that "remedial education" be added to the list of possible remedies, and (iv) the furnishing by Ciba of research material on hyperactivity, all add up to a set of circumstances justifying the conclusion that Ciba paid "money, service or other valuable consideration for the inclusion of any matter as part of such program..." NWRO also asserts that NTN's editorial judgment in writing the script may have been affected by the knowledge that Ciba was paying the bill.
24. In amending Section 317 and adding Section 508 to the Communications Act in 1960, Congress set forth a series of 27 examples to illustrate the effect of the proviso clause in amended Section 317(a). n7 [*195] Example 26 regarding the furnishing by a bus company of a free travel film is quoted in par. 8 above. Examples 26(a) and 26(b) state that no identification of the bus company as having furnished the film is required where no mention of the company or its buses is made in the film, or even where a bus clearly identifiable as that of the bus company "is shown fleetingly in highway views in a manner reasonably related to that travel program." Since Section 508(f) uses the same language as the proviso clause of Section 317(a) in defining "service or other valuable consideration" for the purposes of Section 508, we are compelled to conclude that Congress in amending Section 317(a) and adding Section 508 to the Act did not intend to require that disclosure to the licensee of acceptance of "money, service or other valuable consideration" is required in the circumstances such as those of the present case, and we so conclude.
n7 This clause, in referring to a station's obligation to announce that matter must be announced by a station as paid for or furnished if money, service or other valuable consideration has been accepted for its broadcast. states as follows:
Provided, that "service or other valuable consideration" shall not include any service or property furnished without charge or at a nominal charge for use on, or in connection with, a broadcast unless it is so furnished in consideration for an identification in a broadcast of any person, product, service, trademark, or brand name beyond an identification which is reasonably related to the use of such service or property on the broadcast."
Identical language is used in Section 508(f) to exempt from the application of that Section services or other valuable consideration furnished under the conditions set forth In the above proviso clause of Section 317(a).
25. Moreover, even if Example 26 had not been provided by Congress as evidence of its intent, we believe that the underlying purpose of Sections 317 and 508 was here accomplished, in that the viewers were informed "by whom they were being persuaded," namely, the American Academy of Pediatrics. We find no reason to conclude that AAP did not determine the content of the announcement or that it would have implemented any suggestions from the funding company as to content which did not accord with AAP's professional judgment as to medical validity, relevance to a significant problem and public interest to be served by broadcast of the material. Hyperactivity among children is recognized as a serious problem, and the complainant has advanced no argument to disprove the bona fides of AAP in determining on the basis of its special expertise in the medical problems of children that Ciba's suggestion of an announcement about hyperactivity should be accepted. There may well be other circumstances in which we might reach a different conclusion regarding failure to disclose that production of a program or an announcement was paid for by a party other than that identified on the air with it, but we do not find the facts of this particular case to require such a conclusion.
26. NWRO also alleges that Station WSVA-TV violated Section 317(c) of the Act by failing to "exercise reasonable diligence to obtain... from... persons with whom it deals directly in connection with any program or program matter for broadcast, information to enable such licensee to make the announcement required by this section"; i.e., the sponsorship identification announcement required by Section 317(a). Aside from the fact that, as stated above, we find that no identification of the so-called "sponsorship" of Ciba was here required, we cannot find that the licensee failed to exercise the reasonable diligence specified in 317(c). As was stated by former Chairman Ford (see par. 10 above), this subsection "would not place the licensee in a position of being an insurer, nor does this condition permit a licensee to escape responsibility for sponsorship announcements by inactivity on his part." WSVA-TV here pre-screened the announcement and noted nothing therein which appeared to raise questions as to proper sponsorship identification. The announcement contained no reference to any particular medical product or any supplier of such products. The announcement was distributed under the imprimatur of a nationally [*196] known and widely respected professional medical organization. We believe that under the circumstances the licensee cannot be held to have violated Section 317(c).
27. The complainant also alleges that WSVA-TV violated Section 317(a)(2) of the Act. This subsection merely authorizes the Commission to require that an appropriate announcement be made "in the case of any political program or any program involving the discussion of any controversial issue for which any films, records, transcriptions, talent, scripts, or other material or services of any kind have been furnished, without charge or at a nominal charge, directly or indirectly, as an inducement to the broadcast of such program." The subsection in itself thus requires nothing of a licensee. However, in Section 73.654(d) of the Rules the Commission adopted the requirement described in Section 317(a)(2) with respect to political programs or those discussing public controversial issues. NWRO claims that the controversial issue involved is the use of medication on children who exhibit symptoms of hyperactivity and that the facts that Ritalin was not mentioned and that medication was only one of several possible solutions to hyperactivity mentioned do not mean that the Commission cannot look beyond the words of the script to ascertain whether the announcement involved the discussion of an issue of public controversy. It cites Esso, supra, as a case in which the Commission ruled that a series of advertisements dealt with the Trans-Alaska pipeline controversy although the announcements did not mention the pipeline.
28. As stated by NWRO, the controversial issue of public importance is whether the use of medication in the treatment of hyperactivity is a controversial issue of public importance; i.e., whether, when an announcement is broadcast that identifies the characteristics and problems of hyperactive children, that indicates several remedies, including medication, as being available and urges consultations with physicians, the licensee was unreasonable in failing to determine that the announcement raised a controversial issue of public importance.
29. In response to a Commission inquiry, Felix de la Cruz, M.D., Special Assistant for Pediatrics, Mental Retardation Branch, National Institute of Child Health and Human Development, reviewed the announcement in question and found that "it had no medically controversial implications." He stated specifically that the statement that "sensitive care, remedial education and in some cases the use of medication can help these children..." was "fair and not misleading." He explained that "the treatment for hyperactive children commences with individual attention and placement in a special educational environment and that drug therapy is initiated when this attention and specialized environment is not substantially effective and most often when the hyperactivity is considered to be a symptom of minimal brain damage." The AAP and NTN submitted several publications (copies of which were sent to the NWRO) that indicate that medication is one of several methods used commonly for the treatment of hyperactivity in children. "An Evaluation of the Pharmalogic Approaches to Learning Impediments," 46 Pediatrics 142 (July 1970); "The Hyperkinetic Behavior Syndrome," Medical Insight, pp. 22-29, [*197] (November 1971); "Hyperactivity in Children," 11 Clinical Pediatrics 30, (January 1972). These articles also disclose that Ciba's Ritalin is only one of several medications used for the treatment of hyperactivity in children. The report by Ciba before the Senate Judiciary Committee's Subcommittee to Investigate Juvenile Delinquency (August 5, 1971) also indicated that Ritalin, while popular, was not the only drug used for the treatment of hyperactivity. In this regard, Dr. de la Cruz also stated that "Ritalin is not necessarily the drug of first choice in treating hyperactive children. Depending upon the child and upon the preference of the physician, an amphetamine, an anti-convulsant, a psychotropic agent such as Ritalin, or even other drugs may be chosen." Moreover, of course, the use of Ritalin was never mentioned in the announcement. It would indeed be difficult to read into the phrase "and in some cases medication" the issue of public controversy which NWRO seeks to attribute to it. Therefore it can be concluded that the licensee did not incorrectly determine that the announcement presented no controversial issue of public importance.
30. The present case is clearly distinguishable from Esso, where a public controversy clearly existed and where, contrary to NWRO's assertion, one of the announcements mentioned a pipeline. In its final ruling on that case denying a petition for reconsideration by the original complaint, Esso, 32 FCC 2d 714 (1971), the Commission clarified its prior two rulings as to the basic issue involved:
... The clear tenor of our prior treatment of this matter has been that the basic controversial issue involved is the proposed construction of an Alaskan oil pipeline. While we have recognized that the parties to the dispute were in disagreement over both the need for developing Alaskan oil reserves quickly and the ecological effects of transporting oil from Alaska by pipeline, we have not suggested that and do not believe that these two facets of the basic problem should be treated as independent controversial issues to be examined separately under the fairness doctrine. (Esso, supra. at pp. 714-715.)
The present case is in no way comparable to Esso. There, we found no question on the basis of existing facts as to the presence of a controversial issue of public importance; the only question raised by complainants' petition for reconsideration was whether there were two distinct issues, and we found there were not. In the present case no evidence has been offered by the complainant that the announcement in question ever raised a controversial issue of public importance, and as noted above, their appears to be good medical authority for finding that no such issue was raised.
31. Finally, NWRO alleges that WSVA-TV violated subsections 73.654 (f) and (g) of the Rules. (See footnotes 3 and 5 above for their texts.) We find no violation, however, and agree here with the contentions of AAP that these two subsections were not intended to define any new situation in which identification of a sponsor or furnisher of broadcast material need be made but were intended merely to supplement the substantial provisions of Section 317 of the Act. Section 73.654(f) is intended primarily to prevent concealment of sponsorship by use of an agent, in situations where sponsorship identification is clearly required, which we have found not to be the case here. Section 73.654(g) requires that under certain circumstances if a program is [*198] sponsored or furnished to a station by a corporation, committee, association or unincorporated group, the name of such corporation or group shall be announced. In the present case, the organization furnishing the announcement -- AAP -- was clearly identified in the announcement. n8
n8 In fact, the U.S. Court of Appeals held in U.S. v. WHAS, Inc., 385 F. 2d 784, that even though the licensee had knowledge that the funds used to buy time for a political program had been furnished by an organization other than that identified as the sponsor, there was no violation of 73.654(g) because, if the alternatives are eliminated from the language of the rule, it reads,
In the case of any program... which is sponsored... by a... committee... the announcement required by this section shall disclose the name of such... committee.
The Commission has proposed rule-making to clarify the rule. 34 FCC 2d 1104 (1972). This proceeding has not yet been completed.
32. For the foregoing reasons, the complaint of the National Welfare Rights Orgnization against Gilmore Broadcasting Corporation, the American Academy of Pediatrics and the Ciba Pharmaceutical Company is DENIED.
FEDERAL COMMUNICATIONS COMMISSION, BEN F. WAPLE, Secretary.
CONCURRING STATEMENT OF COMMISSIONER BENJAMIN L. HOOKS
The National Welfare Rights Organization (NWRO), representing the interests of parents concerned about drug abuse (hence, any undue emphasis on drugs as problem solvers), has complained about certain spot announcements on the affliction known as hyperactivity run by many television stations, the production costs of which spots were paid for by a pharmaceutical manufacturer which produces a drug used in treatment of the disorder. It is not so much the fact that the production costs were underwritten by a drug manufacturer that concerns NWRO, but that the announcements were identified as "a public service announcement by the American Academy of Pediatrics (AAP)", a pre-eminent organization of children's doctors, under whose auspices the spots were made and distributed, without any indication of the pharmaceutical manufacturer's financial interest in [*199] producing the spots or its interest in the sale of hyperactivity medication.
I concurred in this decision for two principal reasons: (1) the text of the announcements at issue did not -- at least to me -- expressly plug drugs (let alone the particular drug produced by the industrial benefactor); and (2) the fact that the AAP, a reputable medical association which was fully identified, did edit and took responsibility for the presentation. Accordingly, I cannot find a breach of communications law as written or interpreted and it would be inequitable to penalize either the broadcasters involved, the AAP, or the manufacturer for conduct not deemed proscribed. Let me hasten to inject that my issuance of a separate statement does not, by implication, mean that I oppose the practice service advertisements. of Bona fide public interest announcements I would no more restrict the assistance rendered should be required in connection with the dissemination of public service advertisements. in connection with the dissemination that a specific identification of the I would no more restrict the financial or technical support of public service ads by private industry -- just because they are private -- than I would advocate a ban on similar charitable or pro bono activities of businessmen in non-broadcast fields. Moreover, I am apprehensive that a strict requirement that all private support sources be identified in the presentation of public service announcements would curtail the preparation of worthwhile, well-produced public interest spots. No better example of an important health problem heretofore undercovered by the media can be found than hyperactivity, a seriously misunderstood condition which the spots in instant matter (according to all reports) do an excellent job of in terms of illuminating the problem, identifying symptoms, and recommending professional guidance.
But, the NWRO complaint does focus on an enigma that has previously vexed the Commission, the Congress, and broadcasters themselves. Namely, what ethical considerations are involved in the dissemination of material in the form of public service announcements when one of the progenitors of the announcement has a vested commercial interest directly related to the substance of the spot. Without casting aspersions on the manufacturer here involved or discrediting its motives in promoting the hyperactivity announcements, it is unavoidably clear that the company is in the business of marketing a drug, the sales of which drug stand to increase if more people are aware and seek treatment of hyperactivity. A potential conflict of interest is readily apparent and NWRO is justified in pointing out these circumstances.
There are, consequently, strong public interest arguments to be made both for and against expanding the application of our sponsorship identification rules, critical in the case of commercial and political spots, to public service announcements. My preference in this case would have been the issuance of a Notice of Inquiry looking into the issue of private subsidization of public service spots in order to more fully hear and consider all sides of this important question. The Inquiry [*200] could have elicited present industry practices, the possible need for circumscribing those practices more definitively while at the same time increasing industry awareness that a line must be drawn between legitimate public interest messages and those which subtly serve as institutional ads. Where the appeal of an announcement is significantly commercial, NWRO is correct in demanding that the public be apprised of the real party in interest making the pitch. n1
n1 That the Commission is concerned with adequate identification of the fire behind the smoke is underscored, ironically, by a Public Notice, entitled Identification of Source Of, Or Party Supplying Certain Broadcast Matter (FCC 73-595, June 1, 1973) adopted the same day as the Commission acted on this matter. The Public Notice above was inspired by complaints that some licensees had failed to properly identify, of all people, "Uncle Sam" as the source of various program matter, thus misleading the public into believing that someone other than the federal government was responsible for the message.
In another area, the Commission is equally concerned by newspaper and other revelations that certain sports announcers may be receiving instructions and/or compensation from the sports organizations whose activities they cover without apprising the public of the connection.
Hence, the whole question of anonymous influence on broadcast material is ripe, I think, for Commission exploration. There may be nothing wrong with present practices, but it is always instructive to analyze them.
DISSENTING OPINION OF COMMISSIONER NICHOLAS JOHNSON
I have no objection to the American Academy of Pediatrics--or any other bona fide professional group--producing and distributing public service announcements providing health information. Indeed, I would encourage such groups--and broadcasters--to bring more such information to listeners and viewers.
I have very strong objections to drug companies--or other heavy advertisers--using such groups as a cover in a broad (even "public spirited") secret effort to promote the sale of their products.
Nor can I conclude that the issue of whether or not to give kids drugs as a way of reducing their nuisance value to teachers, parents and other adults is "non-controversial."