FCC proposes record fine for retransmitting broadcast signals without consent

The FCC has proposed a $2.25 million fine for a company that operates a cable system in Houston, TX, for retransmitting the signals of six television broadcast stations without their consent. It is the largest fine for retransmission violations ever levied by the FCC.

The commission’s Media Bureau launched an investigation of TV Max, Inc. (doing business as “Wavevision”) and other related entities, based on complaints from four major television broadcasters alleging that TV Max retransmitted their stations’ signals without permission.

The commission found TV Max’s violations to be “very serious, warranting a substantial penalty, given the longstanding unauthorized carriage that continued even after the Bureau warned TV Max about its actions.”

The FCC rejected TV Max’s argument that it does not need broadcasters’ consent to carry the television signals because its action falls within a narrow exception in the rules, the so-called “MATV exception.” The exception provides that in limited circumstances cable operators do not need broadcasters’ consent to retransmit broadcast signals to building residents when the signals are received by master antenna television (“MATV”) facilities.

The commission found that because TV Max was providing broadcast signals received at its off-site cable headend, it should have the proper obtained consent to retransmit the broadcast signals.

“... We find that TV Max’s unlawful retransmission of the stations’ signals over its cable system to its cable subscribers is not cured by its installation of MATV systems on its MDU buildings,” the commission said.

The MATV exception, it found, pertains only to broadcast signals received by master antenna television facilities.

The broadcasters bringing the complaint were Fox, Univision, Post-Newsweek and ABC. They charged that T-Max continued to retransmit their signals without payment after their agreements had expired at the end of 2011. No new agreements were in place.

The FCC found that T-Max “willfully and repeatedly violated, and continued to violate, the commission’s retransmission consent rules.” T-Max has been given 30 days to stop delivering the broadcaster’s signals.