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Groups Petition FCC Against Tribune Bid

Jun 11, 2007  •  Post A Comment

A consumer’s group and a religious group active in Federal Communications Commission media ownership issues are petitioning the FCC to deny Tribune Co.’s bid to sell itself while holding on to its TV stations in Los Angeles, Chicago, Hartford, New York and Miami.
Calling the proposed $8.2 billion sale to an employee stock option plan and venture capitalist Sam Zell “entirely voluntarily,” the Office of Communication of the United Church of Christ and the Media Alliance said that Tribune has “gamed” the FCC regulatory process and should have to abide by commission rules. Those rules include a cross-ownership ban on a newspaper and broadcast company buying each other in a market.
The groups questioned the legality of the Tribune’s request for waivers to keep the stations while the FCC reviews its media ownership rules and urged the FCC to either entirely reject the license transfers altogether, or condition them on the stations sale.
“The proposed transaction is entirely voluntary,” said the groups’ filing. “Tribune decided to put itself up for sale and chose the matter in which it did so.”
Calling the sale’s structure “mind-boggling and complex” and describing it as a tax efficient restructuring aimed at maximizing shareholder value, the groups contend Tribune offers no “serious argument” that a waiver of the rule benefits the public and/or does anything other than minimizes the company’s burden.
“Simply put, Tribune may not advance its private interests at the expense of the public,” said the filing. “The commission is charged with taking action in the public interest, not with protecting the private interests of those who volunteer to be commission licensees.”
The petition represents the biggest battle yet in the long running Tribune fight over the cross ownership rule that began with the company’s purchase of Times Mirror in 2000. That purchase and another left the Tribune violating the rule in New York, with Newsday and WPIX-TV; Los Angeles, with the Los Angeles Times and KTLA-TV; Hartford with the Hartford Courant and now two TV stations WTIC-TV and WTXX-TV, and South Florida, where the company owns the South Florida Sun-Sentinel in Fort Lauderdale and WSFL-TV in Miami.
The latest deal adds Chicago to the affected cities, with the ownership change eliminating the grandfathering the company enjoyed because its Chicago Tribune and WGN-TV ownership dated from before the FCC adopted its cross-ownership rule.
There are also fights over renewal of licenses for some of the individual stations.
Shaun Sheehan, VP-Washington Affairs for Tribune, called the cross ownership rule outmoded.
“In 2004, the Federal 3rd Circuit wrote that on major market cross ownership, the Commission got it right,” he said. “Anyone alive today if concerned about free broadcasting would vote for relief and the jettisoning this Nixon Administration anti-Washington Post affront to the First Amendment.”
In the past the company has contended the cross-ownership rule is outdated, failing to reflect the number of news sources now available and that joint ownership like that in Chicago benefits local residents.
(Editor: Romanelli)

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