Fox's TV Licenses Safe From Scandal—For Now

The U.K. arm of Rupert Murdoch's media empire may be in trouble due to the ongoing phone hacking scandal there, but the licenses that News Corp. holds for the 27 TV stations it owns in the U.S. are probably safe, at least for the immediate future. There is a character clause in the Communications Act, and licenses can technically be revoked over character issues involving station ownership. And certainly the organized left, which has been at odds with—and run campaigns against—News Corp. and its outlets, could be expected to push for an investigation into character issues if the scandal truly comes to American shores. But a number of communications attorneys who spoke with Adweek said the clause would not apply to Fox's U.S.-based broadcast operations, at least not yet. For the Federal Communications Commission to invoke the clause, it would require a conviction for a broadcast-related felony, and that conviction would have to involve people in the chain of command for the TV stations, or misrepresentation by the parent company to the FCC. (Bear in mind that thus far the phone hacking we know of has all been conducted by News Corp. newspapers, not broadcast outlets.) "There was a time when [license revocation] could have happened, but it's a new world. It would be a rare case where conduct would raise questions about the licenses when the conduct doesn't involve broadcasting or the licensee itself," said Stephen Weiswasser, senior counsel with Covington & Burling. Even lawyers with the liberal public interest media organizations think FCC action would be a long shot, at best. "Based on what we know now, it is highly unlikely that whatever is going on in the U.K. will wind up jeopardizing News Corp.'s licenses in the U.S.," said attorney Andrew Schwartzman, president and CEO of Media Access Project. While the chances for a serious challenge to Fox's FCC licenses is low now, that could change if it's discovered that hacking took place in the U.S. as well, and if Murdoch (who became a U.S. citizen in 1985 in order to own TV stations) or one of his executives with authority over TV stations was found guilty of or found to have knowledge of the illegal activities. "The higher up it goes, the more of a problem it is," said Scott Flick, partner with Pillsbury Law. Even if Fox's FCC licenses are challenged and the FCC decides to take the challenge seriously, it could be years before anything happens. The last time the FCC revoked broadcast licenses was RKO in 1987, when RKO was forced to relinquish two TV licenses and 12 radio licenses. That case took 20 years to play out.

Convergent TV

Fox's TV Licenses Safe From Scandal—For Now

Even the left sees FCC revoking licenses a long shot

Katy Bachman

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Katy Bachman