US Justice Dept backs reviving DirecTV lawsuit over transmission fees
By Mike Scarcella
July 24 (Reuters) -The U.S. Justice Department has asked a federal appeals court to reinstate a lawsuit by satellite television provider DirecTV accusing Nexstar Media and two other television station owners of scheming to drive up retransmission fees for distributing content to viewers.
In a friend-of-the-court brief filed Tuesday with the 2nd U.S. Circuit Court of Appeals, the DOJ argued that a lower federal judge applied the wrong legal framework in a March order dismissing DirecTV’s lawsuit against Nexstar, Mission Broadcasting and White Knight Broadcasting.
The department said it was not taking sides in the lawsuit and did not offer a view on who should prevail. It argued that the 2nd Circuit should return the case to the trial court to reconsider its decision, mirroring arguments from DirecTV.
DirecTV had no immediate comment, and Nexstar, the country’s largest third-party owner or operator of television stations, did not immediately respond to a request for one. Mission declined to comment and White Knight could not be reached.
DirecTV and other subscription television program providers pay retransmission fees to station owners such as Nexstar in order to distribute their programming.
The lawsuit, filed last year, said the defendants violated antitrust law by depriving DirecTV "of a fair competitive process that has resulted in higher prices being demanded of it and lost profits."
DirecTV said it would not pay inflated prices, and so did not renew some license agreements and lost access to broadcast stations, subscribers and revenue.
In his order dismissing the lawsuit, U.S. District Judge Kevin Castel in Manhattan ruled DirecTV could not tie any losses it suffered to the alleged antitrust conspiracy. He said DirecTV had not paid inflated fees because it “made the unilateral decision to abandon” negotiations.
The Justice Department’s brief to the 2nd Circuit said Castel’s order was “unduly narrow” and that the harm of alleged price-fixing schemes could be more than just paying inflated fees. Other harms include diminished quality and output.
The government’s brief said DirecTV’s loss of contract renewals, for instance, could be considered an antitrust injury.
DirecTV is seeking damages for lost revenue and a court order barring the defendants from conspiring on future contract negotiations.
The case is DirecTV LLC v. Nexstar Media Group Inc, 2nd U.S. Circuit Court of Appeals, No. 24-981.
For DirecTV: Olivier Antoine, Amanda Shafer Berman and Jordan Ludwig of Crowell & Moring
For Nexstar: Lauren Willard Zehmer and David Haller of Covington & Burling
Read more:
US judge dismisses DirecTV lawsuit against Nexstar, other station owners
Reporting by Mike Scarcella
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