Tribune Media pulls out of Sinclair Broadcast merger

Carla Harmon
August 10, 2018

Sinclair is one of the nation's largest owners of TV stations.

Sinclair has become a significant outlet for conservative views.

The lawsuit, filed in Delaware Chancery Court on Thursday morning, uses similarly tough language regarding Sinclair and seeks damages "including but not limited to approximately $1 billion of lost premium to Tribune's stockholders and additional damages in an amount to be proven at trial".

Tribune said it will sue Sinclair for breach of contract, arguing Sinclair's negotiations with the US Justice Department and FCC were "unnecessarily aggressive".

Reporters at stations owned by Sinclair - which include almost 200 local affiliate news channels across the country branded as ABC, CBS, NBC, Fox, and more - have been forced to run segments that attack Democratic politicians, discredit the FBI's investigation of Russian Federation, call other media outlets "false news", and even run a regular commentary show by a former Trump adviser.


Tribune Media has no further comment.

Tribune withdrew from its $3.9 billion buyout by Sinclair, ending a bid to create a massive media juggernaut that could have rivaled the reach of Fox News.

There was still a slim chance that Sinclair could save the merger because the FCC referred the deal to an administrative law judge.

The so-called "sidecar deals" unraveled the merger's chances of approval, Tribune said, and ultimately prompted its decision to back out and file a lawsuit.

Tribune's move to kill the merger comes three weeks after the Federal Communications Commission voted unanimously against approving Sinclair's proposed acquisition of Tribune Media.


"In light of (the FCC order), this transaction can not be completed within an acceptable time frame, if ever", Kern said.

The Sinclair Broadcast Group was its roots in the early 1970s, when Julian Sinclair Smith operated an FM radio station and a TV station in Baltimore.

Tribune said in the lawsuit that the merger agreement included a clause that when seeking to divest stations, Sinclair would sell in a manner that would avoid "even the threat" of any regulatory review.

Sinclair has defended the decision to have its anchors read from the same script across the country as a way to distinguish its news shows from unreliable stories on social media. The commissioners called into question whether some of Sinclair's proposed divestments were a "sham" because they were being sold to people so closely aligned with Sinclair and in agreements that would still allow Sinclair to operate the stations.

In a surprise move in July, however, Pai said he had "serious concerns" and suggested Sinclair was trying to hide anticompetitive practices in its proposed purchase and divestiture of certain stations.


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