ANA, DISNEY SUFFER SETBACK IN FIGHT AGAINST CHILDRENS' AD RESTRICTIONS

Court Shifts FCC Case From Washington to Cincinnati

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WASHINGTON (AdAge.com) – Walt Disney Co., Viacom and the Association of National Advertisers hit a setback in their bid to delay or halt a Federal Communications Commission rule that imposes dramatic changes on childrens’ TV and Internet advertising.

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The U.S. Court of Appeals in Washington didn’t directly rule on the motions. Instead, it decided to shift the case to Cincinnati, where the U.S. Court of Appeals for the 6th Circuit is considering a challenge from the United Church of Christ that the FCC rule doesn’t go far enough inj protecting children from marketers. The networks and ANA contend the rule goes too far.

'Very concerned'
The District of Columbia's court’s decision, made on procedural grounds, gives little more than a month for action on the rules, set to go into effect Jan. 1. “We are very concerned,” said Dan Jaffe, ANA's exec VP. “With a limited amount of time, the problem becomes more intense, but there is still time for the court to act.”

The FCC rule requires TV and cable stations to count program promotion against advertising limits on shows aimed at those under 13, which effectively reduces available ad time. It also imposes a ban on the use of cartoon characters to sell products on the Web as long as the Web sites are mentioned in the show. Finally, it imposes new limits on mentioning Web sites for commercial products in programming and limits the ability of networks to pre-empt children’s programming.

Cartoon character product tie-ins
The media companies argue that the rules would prevent the use of characters such as Mickey Mouse and SpongeBob SquarePants anywhere on Web sites; that they are unconstitutional; and that they represent an attempt by the FCC to regulate the Internet, over which it has no authority.

Viacom had sought to have the appeals court stay the FCC order pending court arguments and was subsequently joined by the ANA. Disney sought an order to force the FCC to reconsider the rule by Nov. 15. The United Church of Christ’s Office of Communications, headed by former FCC commissioner Gloria Tristani, is arguing that the FCC should have done more to limit interactive content.

Both Disney and Viacom today issued statements saying they remain confident the rule will eventually be halted.

“When we get our day in court we will prevail,” a Viacom spokesman said. A spokeswoman for Disney said the transfer had nothing to do with the case’s merits. “Whichever court considers the case on the merit, it will rule in our favor,” he said.

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