Sinclair Broadcast Group's failed efforts to merge with Tribune Media and build a conservative media powerhouse may be just the start of the broadcasting giant's problems, reports The Hill.
Tribune called the deal off on Thursday and filed a lawsuit against Sinclair for $1 billion. The suit alleges that its would-be business partner broke the terms of their merger agreement and jeopardized the deal by arrogantly dismissing the concerns of officials at the Federal Communications Commission (FCC) and the Department of Justice.
The merger’s collapse was a stunning reversal of fortune for conservative broadcaster Sinclair. The conventional wisdom a few months ago was that Sinclair’s proposal would be approved, giving the company the ability to reach nearly three quarters of the country’s television audience. Now, Sinclair is facing questions about whether it’s even fit to hold a broadcasting license.
According to the agency order last month and Tribune’s lawsuit, Sinclair overplayed its hand with a friendly FCC and a Justice Department that was fully willing to approve the merger but only if the company agreed to sell off certain stations.
Sinclair though wasn’t willing to budge and repeatedly antagonized antitrust officials at the DOJ. At one point, according to Tribune, Sinclair general counsel Barry Faber told the government “sue me” and the company even went so far as to threaten a lawsuit against the Justice Department.
And at the FCC, Sinclair doomed its chances of getting approval by proposing a series of questionable side deals to sell off local television stations to comply with media ownership limits.
Sinclair has long stoked controversy, including by requiring local news stations to air "must-run" segments with a conservative slant.
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