Tribune Co.Fights Divestiture p.9

By: Editorial Staff

PLEDGING TO GO all the way to the U.S. Supreme Court, Tribune Co. will appeal a ruling that it cannot keep both the Sun-Sentinel newspaper in Fort Lauderdale, Fla., and the Miami television station it bought last year from Renaissance Communications.
In a Jan. 16 decision, a three-judge panel of the U.S. Court of Appeals for the District of Columbia denied Tribune Co. a permanent waiver from federal cross-ownership regulations that bar joint ownership of a newspaper and a TV station in the same market. The panel, upholding a Federal Communications Commission ruling from last March, said Chicago-based Tribune would have to sell either the newspaper or WDZL-TV by March 22, the deadline the FCC set when it approved Tribune’s $1.13 billion acquisition of Renaissance and its six TV stations. Under FCC rules, the Miami TV station and Fort Lauderdale-based newspaper cover the same market.
“Our first step will be to ask the FCC for an extension of the deadline and then go to the court of appeals for an en banc hearing [of the full appellate court] and then go from there,” said Tribune general counsel Crane Kenny.
Tribune argued in court that the cross-ownership prohibition has been made obsolete by the burgeoning number of broadcast and cable outlets. The company noted that the Sun-Sentinel is the second-largest newspaper in the market, while the TV station is the seventh-ranked broadcast outlet ? and that both operate in a hotly competitive market. Tribune also asserted that Walt Disney Co. had been given an indefinite temporary waiver from
the cross-ownership ban when it purchased Capital Cities/ABC.
The three-judge panel’s decision, was based only on procedural grounds, and not on the merits of cross-ownership. The appeal should have gone first to the FCC, the panel said.
At the time it announced the Renaissance purchase ? by far the biggest acquisition by the media company ? Tribune executives said they expected cross-ownership restrictions to simply go away before they affected the WDZL property.
Indeed, in the 1996 telecommunications law, Congress ordered the FCC to take a fresh look at the newspaper-TV cross-ownership ban. The agency has started the review, but will not make a determination until later this year, after Tribune’s deadline expires.
While the FCC has not presented any proposals to eliminate the cross-ownership rule, the FCC told the court, “This is not to suggestthat the rule may not be the subject of Commission review in
?(Tribune Co. chairman/CEO John Madigan is taking the cross- ownership fight to the highest court in the land if need be.) [Caption & Photo]

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