Court strikes down FCC indecency policy

NEW YORK (Reuters) - The U.S. Federal Communications Commission's indecency policy is unconstitutionally vague and could create a chilling effect beyond "fleeting expletives" heard on broadcasts, an appeals court ruled on Tuesday in a major win for broadcasting companies.

The ruling, by the U.S. Court of Appeals for the 2nd Circuit in New York, arose after Bono, frontman for the rock band U2, used what the FCC calls "the F-word expletive" during the live broadcast of the 2003 Golden Globe Awards.

News Corp's Fox Television, CBS Corp's CBS Broadcasting and others challenged an FCC ruling in 2004 that on-air expletives that were not bleeped out were indecent and their use could be penalized.

The FCC regulates radio, television, wire, satellite and cable communications. In a statement, chairman Julius Genachowski said: "We're reviewing the court's decision in light of our commitment to protect children, empower parents, and uphold the First Amendment."

The U.S. Supreme Court had weighed in on the case in 2009, ruling that the FCC had the authority to regulate profanity on the nation's air waves. The high court declined, however, to decide whether the FCC's policy violated First Amendment guarantees of free speech and returned the case to the Second Circuit for a decision on that aspect of the policy.

"We now hold that the FCC's policy violates the First Amendment because it is unconstitutionally vague, creating a chilling effect that goes far beyond the fleeting expletives at issue here," the panel of appeals court judges said in a written ruling on Tuesday.

Broadcasters and some free-speech advocacy groups welcomed the ruling.

But the Parents TV Council, an advocacy group founded by conservative activist L. Brent Bozell, criticized the decision, saying broadcast decency law was clear in requiring that indecent material could be broadcast only at times when children are not likely to be in the audience.

"A three-judge panel in New York once again has authorized the broadcast networks' unbridled use of the 'F-word' at any time of the day, even in front of children," PTC president Tim Winter said in a statement. "For parents and families around the country, this ruling is nothing less than a slap in their face."

The matter will in all likelihood return to the U.S. Supreme Court, where it will continue to be watched closely, said David Hudson, a scholar at the First Amendment Center at Vanderbilt University in Nashville, Tennessee.

"This is a significant First Amendment ruling, one that has ramifications throughout the industry and in First Amendment jurisprudence," Hudson said.

The judges wrote that after complaints were filed with the FCC over Bono's statement at the Golden Globe awards, the FCC declared for the first time that a single, nonliteral use of an expletive could be "actionably indecent."

The FCC had found that "the 'F-Word' is one of the most vulgar, graphic and explicit descriptions of sexual activity in the English language" and therefore "inherently has a sexual connotation."

The National Association of Broadcasters said broadcasters will continue to offer programing "that is reflective of the diverse communities we serve" and supported the decision.

"We believe that responsible decision making by network and local station executives, coupled with program-blocking technologies like the V-chip, is far preferable to government regulation of program content," the NAB said.

A Fox spokesman said the broadcaster was extremely pleased with the decision.

"While we will continue to strive to eliminate expletives from live broadcasts, the inherent challenges broadcasters face with live television, coupled with the human element required for monitoring, must allow for the unfortunate isolated instances where inappropriate language slips through," Fox said in a statement.

The case is Fox Television v FCC, U.S. Court of Appeals for the 2nd Circuit in New York, No. 06-1760, 06-2750 and 06-5358.

(Reporting by Jonathan Stempel, Grant McCool, Paul Thomasch, Diane Bartz, Jeremy Pelofsky; Editing by Robert MacMillan, Steve Orlofsky, Gary Hill)