Nexstar-Tegna Merger Blocked Amid Antitrust Concerns
A significant merger between two major local television companies, Nexstar Media Group and Tegna, has been temporarily halted by a federal judge. The decision comes as an antitrust lawsuit looms on the horizon, raising questions about the merger’s impact on consumers and local journalism.
Late Friday, U.S. District Court Chief Judge Troy L. Nunley in Sacramento, California, ruled that the merger cannot proceed until the lawsuit is resolved. The case, brought by eight Democratic attorneys general and DirecTV, argues that the merger could lead to increased consumer costs and reduced local news options. They claim the deal violates federal antitrust laws meant to prevent monopolistic practices.
The merger, announced last year and approved by the Federal Communications Commission (FCC), would create an entity owning 265 television stations across 44 states and the District of Columbia. Many of these stations are affiliates of the major networks: ABC, CBS, Fox, and NBC.
Judge Nunley expressed concerns that the merger would enable Nexstar to raise retransmission fees charged to distributors like DirecTV, potentially increasing consumer bills. Additionally, the judge noted Nexstar’s history of consolidating news stations in markets where it owns multiple outlets, leading to fewer choices for local news.
The judge emphasized that maintaining the status quo is in the “public interest” while the case is pending. DirecTV and the attorneys general argue that Nexstar’s increased leverage could force distributors to accept higher fees or risk losing access to popular programming, such as NFL games.
While Nexstar and Tegna have not commented on the ruling, their attorneys pointed out that the deal received clearance from both the FCC and the Department of Justice (DOJ). They argue that the FCC’s approval includes commitments to expand local journalism and programming.
The FCC had to waive certain ownership rules for the merger to proceed, and FCC Chairman Brendan Carr mentioned in March that Nexstar agreed to divest six stations as part of the process. However, Judge Nunley criticized the FCC’s approval process as “unusual” and not adequately addressing anticompetitive concerns.
The DOJ concluded its antitrust review of the merger through “early termination,” a faster-than-usual process, according to the judge. This expedited closure of the review raised additional questions about the merger’s oversight.
Judge Nunley also noted that President Trump publicly urged regulatory approval of the deal in February, stating the merger would help “knock out the Fake News” amidst ongoing FCC proceedings.
The preliminary injunction aims to maintain current conditions until the legal dispute is resolved. New York Attorney General Letitia James hailed the decision as a “critical victory,” stressing the need for fair competition among local TV stations to ensure reasonable prices and quality programming for consumers.
James emphasized, “Consolidating hundreds of local TV stations under one corporate owner would mean higher prices and lower quality programming for consumers.” She added, “We will keep fighting our case to ensure fair competition among local TV stations that serve communities across the country.”
For more details on the merger and the ongoing legal proceedings, read the original report $6.2 billion merger.
