Paramount and Skydance Condemn Petitions Against Their Deal
Petitions denying Skydance Media's proposed $8 billion purchase of Paramount Global lack standing, call for conditions that would violate the First Amendment, and also raise concerns that are outside FCC jurisdiction, said Paramount and Skydance in an opposition filing posted Thursday in docket 24-275.
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“These filings are procedurally defective, seek relief that raises constitutional concerns, and/or otherwise lack merit,” the companies said. A Center for American Rights (CAR) filing urging the FCC to impose viewpoint neutrality “benchmarks” on content from Paramount-owned CBS “would entangle the Commission with broadcast editorial policies” and “would pose a grave threat to bedrock First Amendment freedoms,” they added. CAR is the group behind a news distortion complaint against CBS and other petitions for FCC action against broadcast networks (see 2412180055). FCC Commissioner Brendan Carr, the incoming chair, has said the agency must address CAR’s concerns about the deal (see 2412180055).
CAR’s proposed conditions are “unwarranted and would be blatantly unconstitutional,” Paramount and Skydance said. The nonprofit's concerns about CBS' news coverage, editing of a 60 Minutes interview with Vice President Kamala Harris, and moderation of presidential debates “fall squarely” within the network's First Amendment protected right to editorial discretion, they argued.
CAR’s suggestion that the public interest standard requires “an after-the-fact judgment on precise editorial decisions” would, if carried to its logical conclusion, mean the government can direct the editorial choices of news organizations, Paramount and Skydance said. CAR’s requested conditions “would be just as likely to undermine as to achieve the Center’s apparent goal of combatting perceived media bias against conservative political viewpoints” because a future FCC could invoke that precedent to require a broadcaster to amplify progressive viewpoints as a merger condition, they added. CAR’s petition is “anathema to the First Amendment,” the companies said.
“Even if the Center had demonstrated a track record of bias at CBS -- which the Applicants adamantly dispute” -- CAR hasn’t presented any evidence that Skydance intends to operate the CBS stations “in a manner contrary to the public interest.”
The companies also aimed at CAR's arguments that Paramount’s internal diversity policies were evidence of a pattern of racial discrimination and that a Chinese company owning a minority stake in the combined entity could lead to undue foreign influence. CAR “mischaracterizes Paramount’s laudable efforts to promote diversity in its workforce as a form of invidious ‘discrimination.’” Tencent, a Chinese-based company, “will not hold an attributable interest” in the CBS broadcast stations and doesn’t cross the FCC’s 25% foreign ownership threshold, Paramount and CBS said. “Tencent’s (or any other foreign investor’s) entirely passive, non-attributable, minority interests present no basis for concern about undue influence.”
LiveVideo.AI's petition to deny “attempts to embroil” the FCC in litigation that the AI video company is pursuing against Paramount parent company National Amusements over the sales process. That case is in U.S. District Court in the Southern District of New York (docket 1:24-cv-06290). FCC rules bar the agency from considering whether a different buyer would better benefit the public interest when weighing a transaction approval, Paramount and CBS said. “LVA’s grievances as an unsuccessful bidder would not be redressed by denial of the Applications, as the Commission plainly cannot order Paramount to transact with LVA instead,” the companies said.
The FCC also can’t take notice of the sexual harassment allegations against the planned head of New Paramount mentioned in the LVA petition, they said (see 2412170038). “Not only is the LVA Petition devoid of any credible factual evidence,” but the allegations “remain unadjudicated, precluding the Commission from considering them as part of its evaluation of the Proposed Transaction.”
LVA and CAR lack standing to object to the acquisition, Paramount and Skydance argued. “Neither LVA nor the Center has demonstrated that it or any individual that it represents has suffered or will suffer any cognizable injury related to the Proposed Transaction that would be remedied by the Commission’s denial of the Applications.” Comments from Fuse objecting to the deal over possible harms to the streaming industry ignore that the FCC lacks authority over streaming platforms, Paramount and Skydance said. “Fuse’s hypothesized harms are utterly speculative and unpersuasive.”