×
You will be redirected back to your article in seconds

Appeals Court Strikes Down FCC Ban on Station Joint Sales Agreements

A federal appellate court is pushing the FCC to complete a review of broadcast ownership rules, but also delivered a win for broadcasters after it struck down an agency rule restricting joint sales agreements.

The decision by the 3rd Circuit Court of Appeals, issued on Wednesday, also cited the FCC’s “stalled efforts to promote diversity in the broadcast industry.” It said that the agency has “unreasonably delayed action on a definition of an “eligible entity,” key terms for determining action in minority and women ownership of media entities.

Broadcasters had opposed the FCC’s action in 2014 that prohibited so-called “sidecar deals” among stations in the same market. FCC Chairman Tom Wheeler said that it was closing a loophole that essentially allowed major media entities to skirt media ownership rules restricting control of two or more stations in the same market. The joint sales agreements are pacts between stations to jointly sell advertising.

The appellate court judges concluded that the FCC expanded ownership limits without justifying their scope by completing a review of the media ownership rules. The judges noted that the last review was completed in 2006, even though they are to be done every four years. The 2010 and 2014 reviews are still pending.

The court urged the FCC to act on media ownership, noting that the delay has prevented changes to a rule prohibiting ownership of a station and newspaper in the same market. The judges wrote that it has been of “significant expense to parties that would be able, under some of the less restrictive options being considered by the Commission engage in profitable combinations.”

Dennis Wharton, a spokesman for the National Assn. of Broadcasters, said that they “could not be more pleased” with the ruling.

“We’re pleased the court strikes down the FCC’s punitive joint sales agreement order,” he said. “JSAs are clearly in the public interest — as Congress has decided — and allow free and local broadcasters a chance to compete against national pay TV conglomerates.”

The FCC had no immediate comment. An FCC official noted that the judges found fault with procedure, but did not render an opinion on whether the FCC can consider whether joint sales agreements are tantamount to an ownership interest in another station. The FCC can take the matter up again as the media ownership rules are reviewed.

The court rejected an effort to vacate the broadcast ownership rules because of the agency’s delay in its reviews. They said that would be “the administrative law equivalent of burning down the house to roast the pig.” Wheeler plans to circulate an order on media ownership by June 30, with the expectation that it would be finalized by the end of the year.

An FCC official said that the commission has committed to resolve the definition of eligible entities in the very near future. The court ordered that the parties engage in mediation within 60 days to determine a timetable. If there is no agreement, the court will determine a schedule.

“This is our third go-round with the Commission’s broadcast ownership rules and diversity initiatives,” the judges said. “Rarely does a trilogy benefit from a sequel. To that end, we are hopeful that our decision here brings this saga to its conclusion.”
The full decision is here.

More Biz

  • Michael Avenatti

    Michael Avenatti Arrested on Bank Fraud and Extortion Charges

    Attorney Michael Avenatti was arrested Monday and is facing federal charges on both coasts of bank fraud, misappropriating client funds, and trying to extort Nike, according to federal prosecutors. Prosecutors in the Southern District of New York allege that Avenatti tried to extract more than $20 million from Nike, and said that if the company [...]

  • Daily Show Viacom

    DirecTV, Viacom Avert Blackout After Marathon Negotiation

    DirecTV and Viacom have agreed on a carriage renewal pact covering a raft of Viacom’s cable channels after a marathon negotiation over the weekend. In a joint statement early Monday, the companies said: “We are pleased to announce a renewed Viacom-AT&T contract that includes continued carriage of Viacom services across multiple AT&T platforms and products. [...]

  • Discovery CEO David Zaslav Sees 2018

    Discovery CEO David Zaslav Sees 2018 Compensation Soar to $129.4 Million

    Discovery Inc. president-CEO David Zaslav is once again making headlines for an enormous compensation package. Zaslav’s 2018 compensation soared to $129.44 million in 2018, fueled by stock options and grants awarded as the longtime Discovery chief signed a new employment contract last July that takes him through 2023 at the cable programming group. Zaslav received [...]

  • Jonathan Lamy RIAA

    Jonathan Lamy Stepping Down From RIAA

    Jonathan Lamy, the Recording Industry Association of America’s longtime executive VP of communications and marketing, is stepping down from his post after 17 years, he announced today. As he put it in an email to Variety, “I started back in 2002, which means it’s been 17+ years, four different RIAA CEOs, three format changes and [...]

  • Fox Layoffs

    Disney-21st Fox Layoffs: TV Divisions Brace for Deep Cuts

    A second day of layoffs has begun on the Fox lot in the wake of Disney completing its acquisition of 21st Century Fox on Wednesday. Longtime 20th Century Fox Television Distribution president Mark Kaner is among the senior executives who were formally notified with severance details on Friday morning. 21st Century Fox’s international TV sales [...]

  • anthony pellicano

    Hollywood Fixer Anthony Pellicano Released From Federal Prison

    Anthony Pellicano, the Hollywood private eye whose wiretapping case riveted the industry a decade ago, was released from a federal prison on Friday, a prison spokeswoman confirmed. Pellicano was sentenced in 2008 to 15 years, following his conviction on 78 charges of wiretapping, racketeering, conspiracy and wire fraud. He had been in custody since 2003, [...]

  • This image taken from the Twitter

    HBO’s Reaction to Trump’s ‘Game of Thrones’ Campaign

    Everyone wants a piece of the “Game of Thrones” lemon cake. From Bud Light to Red Bull the world of Westeros is open to a lot of brand partnerships, unless you’re using that iconic typeface to push a political agenda. In November of 2018 President Donald Trump unveiled a “Thrones” inspired poster with the words [...]

More From Our Brands

Access exclusive content