Workers on strike at CNI Canal 40; gov't may revoke license

MEXICO CITY — There is no quick fix in sight for Mexico’s ailing indie net CNI Canal 40 — it’s off the air, creditor TV Azteca is filing to begin bankruptcy proceedings and its owner, Javier Moreno Valle, remains a fugitive. Tiny Canal 40 has been off the air since May 19 after 300 workers went on strike saying they hadn’t been paid for six months. The government could revoke the net’s license after 60 days off air. However, union reps say the law can’t be applied during a strike and the government is suggesting it has discretion in the case. Meanwhile, the union says execs aren’t talking to them.

“The owner hasn’t even shown his face,” says Canal 40’s union leader Ricardo Acedo. But dealing with an angry union demanding 40 million pesos ($3.2 million) in back pay is difficult when you are on the lam.

A federal judge issued an arrest warrant June 29 for Moreno Valle on charges of evading $297,000 in taxes. That is on top of claims made in February by Mexico’s Tax and Finance Secretariat that Canal 40 owes $19 million in unpaid taxes.

Amid the chaos, TV Azteca is trying to launch two bankruptcy lawsuits, one against Canal 40 and the other against Moreno Valle.

TV Azteca says the net owes it $35 million from a shared production and advertising deal that went sour in 2000. That deal gave TV Azteca the right to take a majority stake in Canal 40 if it broke the contract — an option the No. 2 net has being trying to enforce since.

Mexico’s bankruptcy institute reps say TV Azteca’s lawsuit against Canal 40 cannot proceed until the strike is resolved. Even then, the legal process could take up to a year. The lawsuit against Moreno Valle will not be impeded by the strike and may move more quickly.

Azteca has blocked Moreno Valle’s past attempts to sell the net in the hopes of adding Canal 40 to its two channels. However, the government may be unwilling to let TV Azteca take over Canal 40.

Televisa and TV Azteca hold a duopoly on the nation’s television market, and regulators may prefer the station to end up in other hands.

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