Judge Halts Nexstar-Tegna Merger Amid Antitrust Concerns
A significant merger valued at $6.2 billion between Nexstar Media Group and Tegna has been temporarily blocked by a federal judge. The ruling will remain in place until an antitrust lawsuit challenging the merger is concluded.
U.S. District Court Chief Judge Troy L. Nunley, based in Sacramento, California, issued the decision late Friday. The lawsuit, led by eight Democratic attorneys general and DirecTV, contends that the merger could result in higher consumer prices and negatively impact local journalism. The merger allegedly violates federal antitrust regulations designed to prevent monopolistic practices.
The proposed merger, announced last year, received approval from the Federal Communications Commission (FCC). If completed, it would result in a company owning 265 television stations across 44 states and Washington D.C., primarily as affiliates of major national networks like ABC, CBS, Fox, and NBC.
Judge Nunley expressed concerns that the merger would allow Nexstar to increase retransmission fees for distributors such as DirecTV, ultimately raising costs for consumers. He noted, “viewers will lose options for where to get their local news,” highlighting Nexstar’s history of consolidating local news operations when it controls multiple stations in a market.
The judge also mentioned potential risks for distributors like DirecTV, who may face pressure to accept higher broadcast fees from Nexstar, potentially affecting subscribers’ access to programming, including NFL games.
Judge Nunley maintained that halting the merger temporarily serves the public interest. Despite requests for comment, attorneys for Nexstar and Tegna did not immediately respond.
Nexstar’s legal team argued that the FCC and the Department of Justice (DOJ) had already reviewed and cleared the merger. They asserted that the FCC order mandates Nexstar to enhance, not diminish, local journalism and programming.
The deal required approval from the FCC under the Trump administration, with the government waiving restrictions on the number of local stations a single entity can own. FCC Chairman Brendan Carr indicated in March that Nexstar agreed to divest six stations.
Judge Nunley criticized the FCC’s approval process, describing it as “unusual” and insufficient in addressing the merger’s anticompetitive implications. The DOJ closed its antitrust investigation into the merger in March through “early termination,” a faster-than-usual process.
“In unusual circumstances — with the FCC’s quasi-adjudicatory licensing proceeding still pending — the President himself weighed in publicly in February and urged federal regulators to approve the deal to ‘knock out the Fake News,’” Nunley wrote.
Nunley emphasized that the preliminary injunction aims to maintain the status quo until the lawsuit is resolved. New York Attorney General Letitia James lauded the ruling as a “critical victory,” asserting it would help ensure fair competition among local TV stations nationwide.
James stated, “Consolidating hundreds of local TV stations under one corporate owner would mean higher prices and lower quality programming for consumers.” She vowed to continue the legal battle to uphold competitive conditions in local broadcasting.
