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Time Warner Cable, City of Los Angeles Reach Resolution in Franchise Fee Lawsuit

Time Warner Cable and the city of Los Angeles have reached a resolution of ongoing litigation over the payment of almost $10 million in franchise fees.

The terms were not disclosed, but U.S. Magistrate Judge Jay Gandhi said in a court filing this week that the “parties have now reached a resolution and are memorializing an agreement.”

Los Angeles City Attorney Mike Feuer filed suit against Time Warner Cable in March, 2014, 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 public, educational and government television fees from 2010 and 2011.

The lawsuit was filed just weeks after Comcast announced its plans to merge with TW Cable, the dominant cable operator in the Los Angeles market. Those plans were abandoned in April after it was clear it would not gain regulatory approval. Charter Communications is now seeking regulatory approval to buy TW Cable.

Time Warner Cable filed a counterclaim against the city, contending that its subscribers have been overpaying municipal government fees and that they are due to receive refunds. They argued that TW Cable had 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, its intended purpose.

A spokesman for Feuer and a spokeswoman for TW Cable did not immediately return messages for comment.

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