Published: Fri, August 10, 2018
Life&Culture | By Peggy Hughes

Tribune Media scraps Sinclair deal

Tribune Media scraps Sinclair deal

Sinclair, a Maryland-based company which is the largest owner of local news stations in the USA, is notorious for its right-wing, pro-Trump slant, and its unusual system of distributing slanted "must-run" content to its local stations to work into their broadcasts. Tribune also filed a lawsuit, accusing Sinclair with breach of contract.

Tribune seeks about $1 billion of lost premium to Tribune's stockholders and additional damages in an amount to be proven at trial, according to a copy of the lawsuit filed in Delaware.

Tribune Media highlighted those divestitures - which reportedly would have involved selling stations to companies with close ties to the Smith family - in a statement on Thursday, saying Sinclair "engaged in unnecessarily aggressive and protracted negotiations" with both the FCC and the Justice Department.

Now, Tribune will likely sell its stations to another local broadcaster, and conservative-leaning Sinclair will likely pursue other deals to acquire more local stations, as its CEO Christopher Ripley suggested during an earnings call Wednesday.

Had the merger with Tribune Media been approved, Sinclair would have completely dominated the local news market.

In addition to its merger plans, Sinclair also made headlines in April, when it ordered anchors at dozens of its TV stations to read the same speech during their broadcasts, warning against "biased and false news".

There was still a slim chance that Sinclair could save the merger because the FCC referred the deal to an administrative law judge.

Approval of the merger was widely considered inevitable because Trump's FCC chairman, Ajit Pai, is notoriously anti-regulation and pro-merger, and had rolled back ownership rules for broadcast media companies previous year in a manner that seemingly paved the way for the deal.

It also follows a significant blow from the Republican-led Federal Communications Commission last month, when it questioned Sinclair's candor over the planned sale of some stations.

In its statement, Tribune said, "Sinclair's entire course of conduct has been in blatant violation of the merger agreement and, but for Sinclair's actions, the transaction could have closed long ago".

The FCC vote means that the "merger can not be completed within an acceptable timeframe, if ever", Tribune CEO Peter Kern said.

By filing a lawsuit against Sinclair, Kern said, Tribune intends to "hold Sinclair accountable". Sinclair defended the script as a way to distinguish its news shows from unreliable stories on social media.

Sinclair Broadcast Group, Department of Justice and FCC didn't immediately respond to requests for comment.

In a surprise move in July, however, Pai said he had "serious concerns" and suggested Sinclair was trying to hide anticompetitive practices in its proposed purchase and divestiture of certain stations.

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