DIRECTV Files Complaint with FCC Questioning Control of Tribune Broadcasting Company During Bankruptcy
Tribune Management Agrees in Principle to Retransmission Consent
Compensation only to be Overruled by Hedge Fund and Investment Bank
With more than 5 million DIRECTV customers losing access to
Tribune Broadcasting Co.'s 23 local stations in 19 cities since midnight
Saturday, DIRECTV today filed a complaint with the Federal
Communications Commission seeking an immediate intervention and
expedited ruling against Tribune for failing to negotiate in good faith
and bringing into question whether broadcast licenses have been
prematurely, and inappropriately, transferred to bankruptcy creditors.
In another case of runaway Wall Street greed, some of America's
wealthiest hedge funds and investment banks, including Oaktree Partners,
Angelo Gordon, JP Morgan Chase, Bank of America and Citibank, forced
Tribune's senior management to renege on an agreement that would have
kept DIRECTV customers connected to their local programming. Their
actions represent a brazen attempt to extract yet another bailout on the
backs of innocent viewers.
The complaint specifies Tribune's most senior executives represented
themselves as possessing authority to negotiate a retransmission consent
agreement and, in fact, achieved such an agreement in principle with
DIRECTV on March 29. However, late the following day, Tribune executives
rescinded the agreement, acknowledging bankrupt Tribune's hedge fund and
investment bank creditors overruled senior management, exercising
authority over Tribune's broadcast licenses and operations the FCC has
yet to grant.
The full complaint can be found at www.directvpromise.com.
"Two days prior to expiration of the existing carriage arrangement, the
parties reached an agreement in principle for continued carriage," the
complaint reads. "The following day, however, Tribune reneged on that
agreement. Tribune later confirmed that its management had been
overruled by the hedge fund and investment bank creditors.
"DIRECTV negotiated with Tribune for months, only learning on the very
eve of expiration that it had never been dealing with anyone who had the
authority required under the [FCC] rules. Indeed, DIRECTV still
does not know with whom it should be speaking — Tribune's CEO or its
associated hedge funds and investment banks," the complaint continues.
After entering bankruptcy in December 2008, Tribune sought FCC approval
to transfer its broadcast licenses to a new entity that will eventually
emerge in Tribune's reorganization. Three of Tribune's largest
creditors—JP Morgan Chase Bank; Angelo, Gordon & Co. and Oaktree
Partners — will control 30 percent of the voting and equity interests,
Tribune explained. But the FCC has yet to rule on those transfers. That
means those same hedge funds and investment banks currently lack
authority over Tribune broadcast operations.
The result is millions of everyday viewers are forced to suffer with the
mess Tribune made of its operations leading into bankruptcy, and to make
matters worse, now allowing America's wealthiest hedge funds and
investment banks to take advantage of innocent viewers.
DIRECTV (NASDAQ: DTV) is one of the world's leading providers of digital
television entertainment services delivering a premium video experience
through state-of-the-art technology, unmatched programming and industry
leading customer service to 32 million customers in the U.S. and Latin
America. In the U.S., DIRECTV offers its 19.9 million customers access
to more than 170 HD channels and Dolby-Digital® 5.1 theater-quality
sound, access to exclusive sports programming such as NFL SUNDAY
TICKET™, Emmy- award winning technology and higher customer satisfaction
than the leading cable companies for 11 years running. DIRECTV Latin
America, through its subsidiaries and affiliated companies in Brazil,
Mexico, Argentina, Venezuela, Colombia, and other Latin American
countries, leads the pay-TV category in technology, programming and
service, delivering an unrivaled digital television experience to 12
million customers. DIRECTV sports and entertainment properties include
three Regional Sports Networks (Northwest, Rocky Mountain and
Pittsburgh) as well as a 60 percent interest in Game Show Network. For
the most up-to-date information on DIRECTV, please visit www.directv.com.
Darris Gringeri, (212) 205-0882
Mercer, (310) 964-4683
News Provided by Acquire Media