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Judge Threatens to Reject Comcast-NBCU Merger

Jul 28, 2011  •  Post A Comment

A federal judge has threatened to pull the plug on Comcast’s acquisition of NBCUniversal, The Wall Street Journal reports.

Judge Richard Leon criticized the antitrust settlement that allowed the merger to go ahead. The merger, announced in December 2009, was completed in January of this year.

The story says the judge “criticized arbitration terms available to online content companies that disagree with Comcast about program licensing, citing the fact the arbitration agreements can’t be appealed. ‘I’m giving you fair notice I’m not sure I’m going to sign this,’ Leon said. ‘My concerns are such that because of the arbitration it’s not in the public interest.’"

A key concern is that companies that compete with Comcast, such as online distributors, will be denied access to NBC programming.

Judge Leon indicated a possible strategy going forward might include annual hearings by the court to ensure that decisions are made in the public interest.

The story adds: “The government settlement, which has terms that last for seven years, says that Comcast must license programming to online distributors that compete with the company’s cable service. If a company believes Comcast-NBCUniversal has violated this, it can file a complaint with the Justice Department. Justice’s arbitration process can’t be appealed, but the Federal Communications Commission’s process can. The Justice Department lawyer said that companies would have the option to go through arbitration with the FCC.”

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