Failures

by Karl Bode


Filed Under:
ajit pai, fcc, merger, tv ownership

Companies:
sinclair



FCC Confirms Sinclair Misled Agency To Try And Get Its Megamerger Approved

from the disinformation-nation dept

Last week, the FCC shocked many by sending the Sinclair Tribune merger to merger review purgatory. It was shocking, in part, because the FCC had spent the better part of the last year comically neutering decades-old media consolidation rules specifically at Sinclair's behest, only to suddenly turn around and find fault with Sinclair's logic, relegating the merger review to an administrative law judge (historically the death knell for similar deals). Many of these rules have traditionally had bipartisan support, since they prevent any one company from dominating local media and distorting public discourse.

In a statement, FCC boss Ajit Pai indicated that the company appears to have misled regulators in its bid to pretend the deal would fall under the national media ownership cap, which bans any one broadcaster from serving more than 39% of the population. Again, a stark and sudden reversal for an agency that, until last week, had been taking an ax to decades-old media consolidation rules specifically to help grease the skids for the controversial deal, which would have given Sinclair ownership of more than 230 stations reaching 72% of the public.

Sinclair's merger is controversial thanks to the company's comically-slanted and highly misleading local news coverage, which recently made headlines thanks to a viral Deadspin video showing the facts-optional claptrap the broadcaster forces local stations to air in somewhat creepy synchronicity. But Pai kept going out of his way not only gutting media ownership rules, but re-instating obscure bits of regulation specifically to help Sinclair tiptoe around such limits (odd for a guy that complains endlessly about "burdensome, unnecessary regulation").

Pai's efforts to aid Sinclair were so blatant, he's now facing an investigation by the FCC's nonpartisan Inspector General into whether he coordinated the assault on the rules with Sinclair.

In short, for Pai to retreat from his Sinclair cronyism, the company must have done something notably idiotic. That something was subsequently laid out in the full FCC order (pdf) shoveling merger review off to an administrative law judge, something traditionally seen as fatal for such deals. The order notes that Sinclair, as some consumer groups had noted, had been trying to tap dance around remaining ownership rules by offloading some broadcasters to shell companies, subsidiaries and Sinclair partners at highly-discounted rates, hoping to then reacquire those companies after the deal was approved.

The FCC's order is decidedly polite about it, but repeatedly notes how Sinclair tried to bullshit its way around the fact it had business ties to many of these potential partners and would, in many instances, still be running these broadcast stations post merger. Many of these partners had absolutely zero experience running local broadcasters, and were usually tied to Sinclair in some capacity. Like Steven Fader, CEO of a car dealership, who the FCC notes would have received a decidedly "below market value" deal as part of Sinclair's plan:

"By way of example, one application proposed to transfer WGN-TV in Chicago to an individual (Steven Fader) with no prior experience in broadcasting who currently serves as CEO of a company in which Sinclair’s executive chairman has a controlling interest. Moreover, Sinclair would have owned most of WGN-TV’s assets, and pursuant to a number of agreements, would have been responsible for many aspects of the station’s operation. Finally, Fader would have purchased WGN-TV at a price that appeared to be significantly below market value, and Sinclair would have had an option to buy back the station in the future. Such facts raise questions about whether Sinclair was the real party in interest under Commission rules and precedents and attempted to skirt the Commission’s broadcast ownership rules."

If you watched the FCC railroad consumer interest and trample all objective science during the net neutrality repeal, it's understandable why Sinclair executives thought they'd be able to peddle this sort of bullshit at the agency. But the FCC investigation into Pai, who has pretty obvious post FCC political ambitions, likely gave the agency boss pause. Others think that opposition to the deal by Trump pal Rupert Murdoch (who was also advocating for the blocking of the AT&T Time Warner deal) may have also played a role in the FCC's decision to walk back from this decidedly-unstable branch.

Regardless, Pai's blockade ensures that the Sinclair merger (at least as written) is likely dead, and it shows that Pai's agency does occasionally do the right thing, even if it's probably for the wrong reasons.


Reader Comments

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  • identicon
    Anonymous Coward, 24 Jul 2018 @ 6:40am

    Too bad Pai won't also figure out he's been mislead about net neutrality.

    reply to this | link to this | view in chronology ]

    • identicon
      mcinsand, 24 Jul 2018 @ 6:51am

      there wasn't any misleading

      There wasn't any misleading, just as there were no real questions about what was going on. When the gaming bacame too obvious and Pai fell under scrutiny, he (temporarily, at least) switched from selling out the public to selling out his sponsors.

      reply to this | link to this | view in chronology ]

    • icon
      That One Guy (profile), 24 Jul 2018 @ 5:04pm

      Re:

      'Mislead' implies that he didn't know full well what he was doing, and given everything else he's said and done that's just not feasible.

      reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    identicon
    John Smith, 24 Jul 2018 @ 6:57am

    "Try and…."

    It's "Try TO..."

    An example of the literacy level of the author.

    reply to this | link to this | view in chronology ]

    • identicon
      Wilbert E. Clark III, 24 Jul 2018 @ 7:09am

      Re:

      FCC Confirms Sinclair Misled Agency To Try And Get Its Megamerger Approved

      FCC Confirms Sinclair Misled Agency To Try to Get Its Megamerger Approved

      I have no life.

      reply to this | link to this | view in chronology ]

    • icon
      eaving (profile), 24 Jul 2018 @ 7:12am

      Re:

      If you are not too being pedantic click the link, but the crux of it is ' Some grammarians label try and as incorrect when really it is just very informal and best used in conversation.'

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 Jul 2018 @ 7:12am

      Re:

      Complaining about nit-picky alleged errors of normative english rules (which not everybody even agrees on) make me realize that you have nothing of substance to say against the content of this message, and it can be safely assumed you agree whole-heartedly with everything he said.

      So if you do agree with him, why be so mean about it?
      If you don't agree with him, why didn't you engage with what he said, rather than find something trivial to whinge about?

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 Jul 2018 @ 7:13am

      Re:

      An example of the literacy level of the author.

      ^^^ An example of a fragment pretending to be a sentence.

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 Jul 2018 @ 7:16am

      Re:

      This particular post "is a tale told by an idiot, full of sound and fury, signifying nothing."

      Flagged.

      reply to this | link to this | view in chronology ]

    • icon
      PaulT (profile), 24 Jul 2018 @ 7:21am

      Re:

      You guys are *really* getting desperate now, aren't you?

      reply to this | link to this | view in chronology ]

      • This comment has been flagged by the community. Click here to show it
        identicon
        Anonymous Coward, 24 Jul 2018 @ 9:50am

        Congrats to "John Smith": grammar snark drew half the comments!

        "PaulT", some of the hoots due Techdirt stem from that YOU fanboys are so desperate to write ad hom that SEVEN of you pounce on one minor contrary bit that any (hypothetical) reasonable reader would have just glanced over.

        So here's a bit more pointed snark, hoping to trigger another of your 500-word off-topic, sheer ad hom rants, which reading your 14,500 comment history will turn up many of in any given month.

        [Bet half a peach ya can't ignore this! You're a compulsive.]

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 24 Jul 2018 @ 10:23am

          Re: Congrats to "John Smith": grammar snark drew half the comments!

          some of the hoots due Techdirt stem from that YOU fanboys are so desperate to write ad hom that SEVEN of you pounce on one minor contrary bit that any (hypothetical) reasonable reader would have just glanced over.

          Nine, jackass. NINE!

          And the comment total at the time of this writing is 18 - 10 of which are dedicated to this (not including mine). That's 55.5%, not 50%.

          So:

          A) Learn how to fucking count

          B) Learn how to fucking divide

          on one minor contrary bit that any (hypothetical) reasonable reader would have just glanced over

          C) Learn what the word "irony" means

          reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 24 Jul 2018 @ 10:28am

          Re: Congrats to "John Smith": grammar snark drew half the comments!

          What?

          reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 24 Jul 2018 @ 1:07pm

          How many comments have you posted here?

          reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 24 Jul 2018 @ 9:49pm

          Re:

          Bet half a peach ya can't ignore this! You're a compulsive.

          This coming from the cunt who bragged about his ability/inability to stay off this site.

          Honey, you lost that bet a long time ago. Over thousands of instances.

          Get bent.

          reply to this | link to this | view in chronology ]

        • icon
          PaulT (profile), 24 Jul 2018 @ 11:22pm

          Re: Congrats to "John Smith": grammar snark drew half the comments!

          "SEVEN of you pounce on one minor contrary bit"

          No, we pounced on an idiot whose entire comment was whining about a minor piece of grammar in the headline of the article.

          You wrote far more words, and said even less, except to prove that the anti-Techdirt obsessives who make up the fanbase of scum like Sinclair and Pai have so little to go on that they can no longer even address the content of the articles.

          reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 Jul 2018 @ 7:34am

      Re:

      "Try and…."

      It's "Try TO..."

      An example of the literacy level of the author.

      A language prescriptivist and a language descriptivist walk into a bar.

      The descriptivist says "Ow!"

      The prescriptivist complains that walking "into" something implies ending up within it, and continues whining about the grammatical inaccuracy while his brain slowly leaks out of his ears from the head injury.

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 Jul 2018 @ 9:28am

      Re:

      How's that Paul Hansmeier defense fund coming along, bro?

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 24 Jul 2018 @ 1:06pm

      Re:

      Assholes who didn’t pass 5th grade shouldn’t be throwing stones in that direction.

      reply to this | link to this | view in chronology ]

  • icon
    Berenerd (profile), 24 Jul 2018 @ 7:29am

    Ajit's paycheck bounced.

    reply to this | link to this | view in chronology ]

  • icon
    Nathan F (profile), 24 Jul 2018 @ 7:43am

    So, no doubt the FCC is going to rush to reinstate those rules they removed to pave the way for Sinclair seeing how Sinclair was 'trying to pull the wool over their eyes' the whole time... right?

    /s

    reply to this | link to this | view in chronology ]

    • icon
      The Wanderer (profile), 25 Jul 2018 @ 6:23am

      Re:

      Nah. That would involve admitting that the rule changes were made in order to clear the way for the Sinclair merger, rather than being unrelated actions which simply had the effect of removing obstacles to that merger.

      reply to this | link to this | view in chronology ]

  • identicon
    Iggy, 24 Jul 2018 @ 7:55am

    FCC decisions are about as fair and objective as the Russian judiciary under Putin. This FCC ruling has nothing to do with the merits of the merger. If Ajit Pai's ties to Verizon should come under investigation, he will no doubt be shocked to find he's been misled on Net Neutrality.

    reply to this | link to this | view in chronology ]

  • icon
    ArkieGuy (profile), 24 Jul 2018 @ 8:10am

    Sinclair is a "friend" of the FCC

    There is a proverb that says "the enemy of my enemy is my friend". And since both Sinclair and the FCC were roasted by Last Week Tonight with John Oliver, they must be friends because John Oliver is obviously "enemies" of both.

    If you haven't watched both of the linked videos, they are really enlightening!

    reply to this | link to this | view in chronology ]

  • icon
    That Anonymous Coward (profile), 24 Jul 2018 @ 9:37am

    TFW you can't cover up what you're doing with "public" comments websites & use racism as a distraction.

    reply to this | link to this | view in chronology ]


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