[Congressional Record Volume 147, Number 54 (Thursday, April 26, 2001)]
[Senate]
[Pages S4008-S4011]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. LIEBERMAN (for himself, Mr. Kohl, Mrs. Clinton, and Mr. 
        Byrd):
  S. 792. A bill to prohibit the targeted marketing to minors of adult-
rated media as an unfair or deceptive practice, and for other purposes; 
to the Committee on Commerce, Science, and Transportation.
  Mr. LIEBERMAN. Mr. President, I rise today to join with Senators 
Kohl, Clinton, and Byrd today in introducing legislation to stop the 
entertainment industry from deceptively marketing adult-rated material 
to children, legislation that hopefully will make the hard job of 
raising kids in today's culture a little easier for America's parents.
  As my colleagues may recall, Federal Trade Commission released a 
groundbreaking report last fall documenting the seriousness of this 
problem. Specifically, the FTC found that the movie, music, and video 
game industries had been routinely and aggressively targeting the sale 
of heavily-violent, adult-rated products to children. Some companies 
were going so far as to conduct focus groups for R-rated slasher films 
with 9- and 10-year olds and to pass out promotional materials for 
other violent R-rated movies at Campfire Girl meetings and Boys and 
Girls Clubs.
  This report engendered a lot of outrage, and with good reason. These 
industries were making a mockery of the ratings systems that they had 
created and promoted. They were also making an end run around America's 
parents, in effect cutting out the middle mom and dad to target 
violent, harmful materials directly to children. The report also 
generated a number of promises from the offending industries to change 
their ways and strengthen their self-regulatory programs.
  This week, the FTC released a follow-up report to evaluate how well 
the entertainment industry has done in keeping its promises, and there 
was some encouraging news. The FTC found in their snapshot survey that 
the movie and video game industries had made real progress in limiting 
their advertising in popular teen venues and in providing more rating 
information in their marketing.
  Other independent analyses show similarly encouraging results. Ad 
revenues for R-rated films on MTV are apparently declining. Disney, 
Warner Brothers, and Fox have pledged not to market R-rated movies to 
children. And several other studios have decided against making or 
distributing heavily-violent movies that were once regularly targeted 
at kids.
  I appreciate these steps, which may well result in reduced revenues 
for some of these companies, and which show that our government can 
work on behalf of parents to prod the entertainment industry to draw 
some lines to protect our children without approaching censorship.
  But much as I appreciate this progress, I cannot really give a full-
blow hooray for Hollywood, because the FTC report makes clear that this 
problem has not been solved. Some video game makers and movie studios, 
including those that have pledged not to unfairly target kids, are 
still advertising adult-rated products in places popular with young 
teens. And the leading music companies and their trade group, the RIAA, 
have sadly been MIA, doing little if anything to respond to the FTC 
report and curb the marketing of obscenity-laced records to kids.
  I am also concerned about the future. The FTC rightly recommended 
that the lasting solution to this problem is responsible self-
regulation, specifically, uniform policies adopted by the entertainment 
industry prohibiting the targeting of adult-rated material to children 
and meaningful sanctions to enforce those standards. Unfortunately,

[[Page S4009]]

to date only the video game industry has agreed, and commendably so, to 
meet this recommendation and truly police themselves. That means there 
is no permanent mechanism of accountability for the movie and music 
industries, no ongoing norm or standard that says it is wrong to market 
adult-rated material to children. And I fear that the competitive 
pressures in these markets are so intense that they will once again 
lead companies to do exactly that once the scrutiny goes away.
  That is why I feel we must go forward with a legislative response. 
The bill we are introducing today would provide a narrowly-tailored 
shield to help protect our children from this kind of unfair and 
unhealthy targeting. It would treat the marketing of adult-rated 
movies, music recordings, and video games to children like any other 
deceptive act that harms consumers, and give the FTC the same authority 
it has under the current false and deceptive advertising laws to bring 
actions against companies that engage in deceptive practices. In 
particular, it would give the FTC the authority to penalize companies 
that violate this provision with civil fines of up to $11,000 per 
offense.
  Some will claim this is censorship. But the truth is we're not 
empowering the FTC to regulate content in any way or even to make 
judgments about what products are appropriate for children. We are 
simply saying that if you voluntarily label a product as being 
unsuitable for kids, and then turn around and market it in a way that 
directly contradicts that rating, you should be held accountable, just 
like any other company that misleads consumers. That's not censorship, 
that's common sense.
  The bottom line here is that the First Amendment is not a license to 
deceive. And this legislation translates that important principle into 
policy. It says to the people who run the entertainment industry that 
they cannot have it both ways. They cannot label their products for 
adults and target them to kids. And they cannot continue to undermine 
their ratings and undercut the authority of parents.
  I ask my colleagues today on both sides of the aisle for their 
support on this bill and the ongoing effort to help protect their 
children from harmful media messages. I thank the chair, and ask 
unanimous consent that my statement and bill be included in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 792

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Media Marketing 
     Accountability Act of 2001''.

     SEC. 2. FINDINGS.

       Congress makes the following findings:
       (1) Children have easy access to a variety of media and 
     entertainment options without leaving their own homes. The 
     vast majority of homes with children have a VCR, a CD player, 
     and either a video game console or a personal computer.
       (2) Children, and especially teenagers, spend a large 
     amount of time listening to music, seeing movies, and playing 
     video games. Specifically:
       (A) Children ages 8 through 13 spend approximately 3 hours 
     per week in a movie theater, on average. In addition, 62 
     percent of children ages 9 through 17 spent an average of 52 
     minutes per day watching video tapes.
       (B) 82 percent of children play video games, and do so for 
     33 minutes per day, on average.
       (C) Children ages 14 through 18 listen to music 
     approximately 2\1/2\ hours per day on average.
       (3) Teenagers spend tens of millions of dollars annually on 
     movies, music, and video games, making them a highly valuable 
     demographic group to the producers and distributors of 
     entertainment products.
       (4) Media violence can be harmful to children. Most 
     scholarly studies on the impact of media violence find a high 
     correlation between exposure to violent content and 
     aggressive or violent behavior. Additional studies find a 
     high correlation between exposure to violent content and a 
     desensitization to and acceptance of violence in society.
       (5) On September 11, 2000, the Federal Trade Commission 
     reported that companies in the music, movie, and video game 
     industries routinely target children under age 17 in the 
     advertisement of adult-rated products. Specifically:
       (A) The Commission found that 80 percent of the R-rated 
     movies studied had been targeted to children. In addition, 
     marketing plans for 64 percent of the R-rated movies studied 
     explicitly mentioned children under age 17 as part of the 
     target audience.
       (B) The Commission found that all marketing plans for music 
     recordings with explicit content labels either explicitly 
     mentioned children under age 17 as part of the target 
     audience or called for ad placement in media that would reach 
     a majority or substantial percentage of children under age 
     17.
       (C) The Commission found that 70 percent of Mature-rated 
     video games studied were targeted to children under age 17, 
     and 51 percent explicitly mentioned children under age 17 as 
     part of the target audience. Additionally, the Commission 
     found that 91 percent of the video game manufacturers studied 
     had at one time expressly identified children under age 17 as 
     the core, primary, or secondary audience of an M-rated game.
       (6) To correct this problem, the Commission called on these 
     industries to adopt voluntary, uniform policies expressly 
     prohibiting these practices and to enforce these policies 
     with real sanctions for violations.
       (7) To date, as the Commission noted in a follow-up report 
     released on April 24, 2001, only the video game industry has 
     agreed to adopt such a marketing code. The Commission also 
     noted that, despite some encouraging changes in behavior 
     since the release of the Commission's original report in 
     2000, a number of companies in all three industries have 
     nevertheless continued to market adult-rated products in 
     venues popular with children.
       (8) Because the entertainment industry continues to target 
     its advertising of adult-rated products to children, there is 
     need for narrowly targeted legislation to prohibit, as a 
     false and deceptive trade practice, the targeting of children 
     in the advertisement and other marketing of products rated 
     for adults, and to authorize the Federal Trade Commission to 
     stop these practices.

      TITLE I--TARGETED MARKETING OF ADULT-RATED MEDIA TO CHILDREN

     SEC. 101. PROHIBITION ON TARGETED MARKETING TO MINORS OF 
                   ADULT-RATED MEDIA AS UNFAIR OR DECEPTIVE 
                   PRACTICE.

       (a) In General.--The targeted advertising or other 
     marketing to minors of an adult-rated motion picture, music 
     recording, or electronic game, in or affecting commerce, 
     shall be treated as a deceptive act or practice within the 
     meaning of section 5 of the Federal Trade Commission Act (15 
     U.S.C. 45), and is hereby declared unlawful.
       (b) Treatment as Targeted Advertising or Marketing to 
     Minors.--For purposes of this section, the advertising or 
     other marketing of an adult-rated motion picture, music 
     recording, or electronic game shall be treated as targeted 
     advertising or other marketing of such product to minors if--
       (1) the advertising or marketing--
       (A) is intentionally directed to minors; or
       (B) is presented to an audience of which a substantial 
     proportion is minors; or
       (2) the Commission determines that the advertising or 
     marketing is otherwise directed or targeted to minors.

     SEC. 102. SAFE HARBOR.

       (a) In General.--The advertising or other marketing to 
     minors of an adult-rated motion picture, music recording, or 
     electronic game shall not be treated as targeted advertising 
     or other marketing to minors, for purposes of section 101, if 
     the producer or distributor responsible for the advertising 
     or marketing adheres to a voluntary self-regulatory system 
     with respect to such product that satisfies the criteria 
     under subsection (b) and is subject to the sanctions referred 
     to in subsection (b)(3).
       (b) Criteria.--The Federal Trade Commission shall, by rule, 
     establish the criteria referred to in subsection (a). Under 
     such criteria, a voluntary self-regulatory system shall 
     include the following elements:
       (1) An age-based rating or labeling system for the product 
     in question.
       (2) For all products that are rated or labeled as adult-
     rated under such system--
       (A) prohibitions on the targeted advertising or other 
     marketing to minors of such products; and
       (B) other policies to restrict, to the extent feasible, the 
     sale, rental, or viewing to or by minors of such products.
       (3) Procedures, including sanctions for non-complying 
     producers and distributors, meeting such requirements as the 
     Commission includes in such criteria in order to assure 
     compliance with the prohibitions and other policies referred 
     to in paragraph (2).

     SEC. 103. REGULATIONS.

       (a) In General.--The Federal Trade Commission shall 
     prescribe rules that define with specificity the acts or 
     practices that are deceptive acts or practices under section 
     101.
       (b) In Particular.--The rules under subsection (a)--
       (1) shall specify criteria for determining whether or not 
     an audience is comprised of a substantial proportion of 
     minors for purposes of section 101(b)(1)(B); and
       (2) may include requirements for the purpose of preventing 
     acts or practices that are deceptive acts or practices under 
     section 101.

     SEC. 104. MATTERS RELATING TO REGULATIONS.

       (a) In General.--The Federal Trade Commission shall 
     prescribe rules under sections 102 and 103 in accordance with 
     the provisions of section 553 of title 5, United States Code.
       (b) Time Limit.--The Commission shall prescribe the 
     regulations required under sections 102 and 103(b)(1) not 
     later than 12 months after the date of the enactment of this 
     Act.

     SEC. 105. ENFORCEMENT.

       (a) In General.--This title shall be enforced by the 
     Federal Trade Commission

[[Page S4010]]

     under the provisions of the Federal Trade Commission Act (15 
     U.S.C. 41 et seq.).
       (b) Actions by Commission.--
       (1) In general.--The Commission shall prevent any person 
     from violating section 101, or a rule of the Commission under 
     section 103, in the same manner, by the same means, and with 
     the same jurisdiction, powers, and duties as though all 
     applicable terms and provisions of the Federal Trade 
     Commission Act were incorporated into and made a part of this 
     title.
       (2) Particular rules.--A rule prescribed under section 
     103(b)(1) shall be treated as a rule prescribed under section 
     18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 
     57a(a)(1)(B)), and any violation of a rule prescribed under 
     such section 103 shall be treated as a violation of a rule 
     respecting unfair or deceptive acts or practices under 
     section 5 of the Federal Trade Commission Act (15 U.S.C. 45).
       (3) Rights and liabilities of parties.--Any person or 
     entity that violates section 101, or a rule of the Commission 
     under section 103, shall be subject to the penalties, and 
     entitled to the privileges and immunities, provided in the 
     Federal Trade Commission Act in the same manner, by the same 
     means, and with the same jurisdiction, powers, and duties as 
     though all applicable terms and provisions of that Act were 
     incorporated into and made a part of this title.
       (c) Effect on Other Laws.--Nothing in this title shall be 
     construed to limit the authority of the Commission under any 
     other provision of law.

     SEC. 106. DEFINITIONS.

       In this title:
       (1) Adult-rated.--The term ``adult-rated'', in the case of 
     a motion picture, music recording, or electronic game, means 
     a rating or label voluntarily assigned by the producer or 
     distributor of such product, including a rating or label 
     assigned pursuant to an industry-wide rating or labeling 
     system, which rating or label--
       (A) indicates or signifies that--
       (i) such product is or may be appropriate or suitable only 
     for adults; or
       (ii) access to such product by minors should be restricted; 
     or
       (B) in the case of a music recording, advises or signifies 
     that such product may contain explicit content, including 
     strong language or expressions of violence, sex, or substance 
     abuse.
       (2) Minor.--The term ``minor'' means an individual below 
     the age established under the rating or labeling system in 
     question to be an appropriate audience for adult-oriented 
     material, but in no event includes an individual 17 years of 
     age or older. If no specific age is so established under the 
     rating or labeling system in question, the term means an 
     individual less than 17 years of age.
       (3) Adult.--The term ``adult'' means an individual who is 
     no longer a minor.
       (4) Electronic game.--The term ``electronic game'' means 
     any interactive entertainment software, including any 
     computer game, video game, or on-line game, sold or rented on 
     any tangible medium or by any electronic or on-line medium by 
     which the right to play a specified interactive-
     entertainment-software product is purchased.
       (5) Motion picture.--The term ``motion picture'' means any 
     theatrical motion picture shown in a commercial theater or 
     sold or rented by videotape, digital recording, or other 
     tangible medium or by any electronic or on-line medium by 
     which the right to play an individual theatrical motion 
     picture is purchased, except that such term shall not include 
     anything shown on broadcast television or cable television.
       (6) Music recording.--The term ``music recording'' means 
     any recording of music sold or rented on compact disk, tape 
     cassette, vinyl record, music video, or other tangible medium 
     or by any electronic or on-line medium by which the right to 
     hear a specified work of music is purchased, except that such 
     term shall not include anything shown on broadcast television 
     or cable television.

     SEC. 107. EFFECTIVE DATE.

       This title shall take effect 90 days after the date of the 
     enactment of this Act.

                        TITLE II--OTHER MATTERS

     SEC. 201. STUDY OF MARKETING PRACTICES OF ENTERTAINMENT 
                   INDUSTRIES REGARDING ADULT-RATED MATERIALS.

       (a) In General.--The Federal Trade Commission shall conduct 
     a study of the advertising and other marketing practices of 
     the motion picture industry, music recording industry, and 
     electronic game industry regarding adult-rated motion 
     pictures, music recordings, and electronic games.
       (b) Matters To Be Studied.--In conducting the study under 
     subsection (a), the Commission may examine--
       (1) whether and to what extent the industries referred to 
     in that subsection direct to minors the advertising and 
     marketing of adult-rated materials, including--
       (A) whether such materials are advertised or promoted in 
     media outlets in which minors are present in substantial 
     numbers or comprise a substantial percentage of the audience; 
     and
       (B) whether such industries use other marketing practices 
     designed to attract minors to such materials;
       (2) whether and to what extent retail merchants, movie 
     theaters, or others who engage in the sale or rental for a 
     fee of products of such industries--
       (A) have policies to restrict the sale, rental, or viewing 
     to or by minors of adult-rated materials; and
       (B) have procedures to ensure compliance with such 
     policies;
       (3) whether and to what extent such industries require, 
     monitor, or encourage the enforcement of their voluntary 
     rating or labeling systems by industry members, retail 
     merchants, movie theaters, or others who engage in the sale 
     or rental for a fee of the products of such industries;
       (4) whether and to what extent such industries engage in 
     activities to educate the public in the existence, use, or 
     efficacy of their voluntary rating or labeling systems; and
       (5) whether and to what extent the policies and procedures 
     referred to in paragraph (2), any activities referred to in 
     paragraphs (3) and (4), and any other activities of such 
     industries are effective in restricting the access of minors 
     to adult-rated materials.
       (c) Factors in Determination.--In determining whether the 
     products of an industry are adult-rated for purposes of 
     subsection (b), the Commission shall use the voluntary 
     industry rating or labeling system of the industry, both as 
     in effect on the date of the enactment of this Act and as 
     modified after that date.
       (d) Authorities.--In conducting the study under subsection 
     (a), the Commission may use its authority under section 6(b) 
     of the Federal Trade Commission Act (15 U.S.C. 46(b)) to 
     require the filing of reports or answers in writing to 
     specific questions, as well as to obtain information, oral 
     testimony, documentary material, or tangible things.
       (e) Reports.--
       (1) Requirement.--The Commission shall submit to Congress 
     and the public two reports on the study under subsection (a), 
     as follows:
       (A) An initial report, not later than two years after the 
     date of the enactment of this Act.
       (B) A final report, not later than six years after that 
     date.
       (2) Elements.--Each report under paragraph (1) shall 
     include--
       (A) a description of the study conducted under subsection 
     (a) during the period covered by the report;
       (B) any findings and recommendations of the Commission 
     arising out of the study as of the end of that period; and
       (C) the identification of the particular producers and 
     distributors, if any, engaged in advertising or other 
     marketing practices relevant to such findings and 
     recommendations.
       (f) Definitions.--In this section, the terms ``adult-
     rated'', ``electronic game'', ``motion picture'', ``music 
     recording'', and ``minor'' have the meanings given those 
     terms in section 106.

     SEC. 202. SEPARABILITY.

       If any provision of this Act, or the application of such 
     provision to any person, partnership, corporation, or 
     circumstance, is held invalid, the remainder of this Act, and 
     the application of such provision to any other person, 
     partnership, corporation, or circumstance, shall not be 
     affected thereby.

  Mr. KOHL. Mr. President, I rise today with my colleague Senator 
Lieberman to introduce the Media Marketing Accountability Act of 2001. 
For too long, the entertainment industry has drawn a bullseye on our 
children's backs, targeting them with violent video games, movies and 
music. Media violence has a clear and dangerous effect on our children, 
and it must be curbed.
  Last fall's Federal Trade Commission report confirmed some of our 
worst fears. It found that more than 70 percent of movie, video game 
and music companies aggressively marketed their violent, adult-rated 
products to children. And while this week's report showed some 
meaningful progress, the ``snapshot'' it took didn't exactly reveal a 
pretty picture. Last fall, Senator Lieberman and I pledged not to sit 
by idly. Today we're here to make good on our promise.
  This legislation is simple. It targets the worst behavior. The 
entertainment industry won't be able to speak out of both sides of 
their mouths anymore, saying that a product is harmful to children, but 
then luring them into the theaters or stores to see it or buy it. This 
bill gives the Federal Trade Commission the authority it needs to go 
after the bad actors who try to mislead our families and our children.
  Let me be a little more specific about what the bill does. This 
legislation gives the FTC the authority to prosecute entertainment 
companies for deceptive trade practices if they target adult-rated 
entertainment to children. This legislation doesn't create a whole new 
structure of rules and punishments; it simply adds this bad behavior by 
entertainment companies to a list of misconduct that the FTC already 
has the power to punish.
  But the bill also rewards companies for good behavior. It includes a 
safe harbor which shields companies from prosecution if they already 
abide by a self-regulatory system that includes an age-based rating 
system, prohibits the marketing of adult rated material to children, 
and punishes for non-compliance. Finally, the legislation calls for

[[Page S4011]]

two additional studies by the FTC over the next six years.
  Let me give you a concrete example of the type of behavior this bill 
aims to prohibit. Last fall's report uncovered a film industry practice 
of including young children in the test groups for R-rated films. 
Studios asked ten-year-olds to explain what they like about a violent, 
R-rated movie, and then the studio used the feedback to tailor their 
advertising campaign to lure youngsters into the theaters. We all agree 
this behavior is just plain wrong, and it is this kind of behavior that 
our legislation will penalize.
  Our bill does not touch the content produced by the industry, it 
simply targets specific, egregious behavior. After all, no one is 
saying that the entertainment industry doesn't produce high-quality and 
important products. But we all agree that not every product is 
appropriate for children, and the Federal Government has a legitimate 
interest in protecting children, a vulnerable audience, from being 
targeted with violent and vulgar content that the industry itself has 
identified as inappropriate. Our narrowly tailored legislation will 
help protect children and families from this kind of deception.
  Finally, our bill should not discourage the entertainment industry 
from rating its products. To begin with, companies that are already 
regulating themselves effectively will qualify for protection under our 
safe harbor. The industry's threat to alter or eliminate their rating 
systems is as irresponsible to families as the behavior we're trying to 
prohibit with this measure. But beyond that, enactment of this 
legislation would not translate to constant legal action against the 
entertainment industry. The Federal Trade Commission would only 
prosecute those companies who have clearly and flagrantly targeted 
children with adult-rated material. As long as companies advertise 
their adult-rated products to a logical target audience, they should 
have no concern about this legislation.
                                 ______