Media General Injunction Against Gray/Schurz Violates Communications Act, DOJ Says
A court challenge by Media General against Gray Television's purchase of Schurz TV stations led Media General to violate the Communications Act, said DOJ in a statement of interest filed with U.S. District Court in Savannah, Georgia, Wednesday. A Richmond…
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County, Georgia, Superior Court judge granted a Media General request for an injunction preventing Gray and Schurz from breaking a joint sales agreement with Media General over WAGT Augusta and from selling WAGT's spectrum in the incentive auction. The dissolution of that JSA was one of the conditions of the Media Bureau's February approval of Gray/Schurz's TV stations, and Media General's request is a violation of the Communications Act, bureau Chief Bill Lake said in a letter to DOJ. “By seeking an injunction to require continued implementation of the JSA, Media General has sought a remedy in conflict with the Commission’s order,” Lake said. “The Commission has long taken the view” it's a violation of The Communications Act for a company “to seek injunctive relief that interferes with a licensee’s ultimate control of a station,” Lake said. Gray argued in court filings the case is rightfully under the jurisdiction of the U.S. District Court in Georgia, and that the case was removed from the lower court before the injunction was ordered. However, the case was remanded to the lower court late Thursday, according to a judgment. Though the court denied a Media General request for an emergency injunction as moot, it's not clear if the injunction from the lower court still applies. According to the judgment, the U.S. District Court lacks subject matter jurisdiction over the case. But the court ordered the injunction be treated as in effect until those questions are decided. By entering into the transaction with Gray that included changes to its JSA agreement, Schurz violated the terms of that agreement, Media General argued. Under a recent congressional change to JSA attribution rules, existing JSAs are grandfathered for the next two decades, while the bureau ruled existing JSAs that are transferred will be treated as new arrangements and thus subject to the new rules. In an email to bureau staff filed as an ex parte, broadcast attorney Jack Goodman -- who represents Schurz -- speculated Media General may be planning to use this case “as leverage” as part of an attempt to argue that its JSAs can't be terminated as part of its proposed sale to Nexstar. Goodman, Media General and Nexstar had no further comment Thursday.