Court Dismisses Standard General's Conspiracy Lawsuit Against Rosenworcel
The U.S. District Court for the District of Columbia dismissed Standard General’s lawsuit accusing former FCC Chairwoman Jessica Rosenworcel, Allen Media CEO Byron Allen and Dish Chairman Charlie Ergen of conspiring to block Standard’s attempted purchase of Tegna in 2023, according to an opinion issued Tuesday. Standard’s attempt to buy Tegna for $8.6 billion unraveled after the matter was designated for hearing (see 2404250059). Nexstar on Tuesday announced its plan to buy Tegna (see 2508190042).
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Judge Rudolph Contreras ruled that Standard General and its founder, Soohyung Kim, failed to show that Rosenworcel and former Media Bureau Chief Holly Saurer discriminated against the company. Contreras also said filings from Dish and others opposing the deal are protected under the First Amendment.
Standard’s lawsuit had accused Rosenworcel, Saurer, Allen, Ergen and I Street Advocates attorney David Goodfriend of collaborating to tank Standard’s purchase of Tegna and of racial discrimination against Kim, who is Korean American. “The FCC Chairwoman and her personal staffer blocked the deal at the behest of Mr. Allen, who used business allies and six-figure political donations to destroy Mr. Kim’s chances of acquiring TEGNA,” said the initial complaint.
Contreras wrote that the complaint “lacks any factual allegation from which to infer that the FCC used Kim’s race negatively.” Standard’s claims of racial discrimination are entirely based on mischaracterized, out-of-context quotes from filings made by groups opposing the Tegna deal, which haven’t been tied to FCC officials, the opinion said. “Plaintiffs’ claims of ‘race-based and xenophobic rhetoric in FCC filings’ melt away at the slightest of scrutiny.” Kim also didn’t face issues in previous transactions before the FCC, the court noted. “Common sense suggests that the transaction at issue, and not Kim’s race, caused the delay this time.”
Standard’s accusations of a conspiracy were entirely based on documented communications and meetings of FCC officials and entities lobbying to prevent the Standard/Tegna deal, but petitioning the government is protected by the First Amendment, Contreras wrote. “Directly asking politicians and FCC officials not to approve the broadcast license-transfers” falls under those protections, the opinion said.
Though Standard argued that Goodfriend and his union clients were raising “baseless” concerns to the FCC about potential job cuts from the Tegna purchase, Contreras said Standard’s promises to the FCC not to make layoffs indicated that the concerns were merited. If those concerns “had been so baseless that no reasonable person would have expected success in pressing those issues before the FCC, then why did Plaintiffs feel pressure to make ‘binding commitments to the FCC’ about those issues?” the judge wrote. “Such conduct would defy logic.”