Univision to Pay $1M to Settle 'Pay for Play' Charges
Payola. It is frequently used as an antiquated term to describe a time when managers and record labels paid DJs to play their music. This practice is also called "pay to play". While payola is not done as openly as it once was, the practice is very much alive today, as a recent case against Univision demonstrates.
On Monday, the Federal Communications Commission and the Justice Department announced two separate settlements of payola charges with the Spanish language media company, Univision, the Associated Press reports. The settlement was for $1 million. The FCC and Justice Department alleged that Univision's radio stations and its employees took cash payments in exchange for more frequent airplay of artists previously on the Univision label.
According to the AP, from 2002 to 2006, Univision employees bribed program managers to entice them to play Spanish artists and did not disclose the payments. Payola is a violation of FCC regulations and federal law. As part of the settlement with the Justice Department, Univision pleaded guilty to conspiracy to commit mail fraud. Conspiracy is an agreement between two or more persons to engage in an unlawful act. Mail fraud is a crime in which the perpetrator intentionally uses the mail to defraud another of money or property.
The Los Angeles Times further reports that, in order to cover their tracks, executives and the record promoters allegedly submitted fake invoices for services that were never rendered. Univision would then pay the invoices and the station managers kept the payments. The bribes ranged from $1,000 to over $100,000.
Payola is illegal in all major music markets in the United States, though it was common in the early days of pop and rock music. Dick Clark was involved in 1959 a Payola scandal, though he avoided prosecution after agreeing to cooperate with investigators. More recently, according to a 2007 Reuters article, Clear Channel and several others settled for $12.5 million for allegedly engaging in Payola.
Related Resources:
- Conspiracy (FindLaw's Learn About the Law)
- FCC settles with Clear Channel, others on payola (Reuters)
- Federal Communications Commission (LawBrain)
- Supreme Court: FCC Can (Probably) Regulate Dirty Words on TV (FindLaw's Courtside)