Time Warner Cable Countersues Los Angeles Over Franchise Fees

Time Warner Cable is firing back against Los Angeles’ claim that it owes the city almost $10 million in fees, contending that its subscribers have been overpaying municipal government fees and that they are due to receive refunds.

Their counterclaim, filed in federal court on Thursday, argues that Time Warner Cable has collected public, educational and government television fees from its customers since 2009 but that “millions of dollars” of that money have not been used to construct TV facilities.

“The fees that the city claims TWC owes would come directly from the pockets of the very taxpayers in whose name the city purportedly brings suit — and who already annually support the city by paying millions,” Time Warner Cable says in its suit. “The city already has collected from TWC and its customers 5 percent of its gross cable revenues in ‘franchise fees,’ the federal and state maximum, as well as an additional 1 percent of gross revenues in PEG fees since 2009. Not only do TWC;s customers not owe the city any more money; they are entitled to refunds of overpayments to the city.”

Los Angeles City Attorney Mike Feuer filed suit against Time Warner Cable in March, claiming that “the city of Los Angeles enabled Time Warner to make billions and in turn they shortchanged the taxpayers millions.” The city claims that TWC owed $2.5 million in franchise and PEG fees from 2008 and 2009, as well as $7.2 million in franchise and PEG fees from 2010 and 2011.

A spokesman for Feuer said that the counterclaim was “meritless” and that it was “designed to distract attention from our allegations that Time Warner owes the taxpayers of Los Angeles millions of dollars.”

Fred Puglisi and Valerie Alter of Sheppard, Mullin, Richter & Hampton represented Time Warner Cable.

 

 

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