Client Alert

Third Circuit Overturns JSA Attribution Rule and Orders FCC to Complete Stalled Ownership Proceedings

May 25, 2016

By Eric Dodson Greenberg, Sherrese M. Smith & Andrew J. Erber

Today, the Court of Appeals for the Third Circuit, in a strongly-worded 57-page opinion, vacated the FCC’s 2014 rule treating certain broadcast television joint sales agreements as attributable for multiple-ownership purposes. Under the now-vacated rule, the right of a station under a JSA to broker more than 15% of the advertising availabilities on another station in the same market would have given rise to an attributable interest in the brokered station. The court’s decision to vacate the JSA rule rested on a complex interplay of administrative procedural considerations, including the FCC’s long delay in reassessing the basis for its media ownership rules.

In addition, the Third Circuit also remanded the 2010 quadrennial broadcast ownership proceeding back to the Commission for prompt action.  As part of the remand, the Court ordered mediation between the public interest petitioners and the FCC to fix a timetable for final agency action.  If the parties are unable to agree on a timeline within 60 days, the court will issue its own schedule.

The decision has broad potential implications for the broadcast industry, including the structure and treatment of broadcast-related transactions. We will be following up with additional analyses of the decision’s implications for the industry, including strategic considerations and new opportunities it may create.

At the same time, please feel free to contact us for a more detailed conversation focused on your individual strategic and business goals.

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