Updated at 10:45am Central
The Supreme Court for the State of New York on Thursday set financial penalties against the largest broadcast TV ownership group in the U.S., asking it to repay direct broadcast satellite TV services provider DirecTV for fees associated with what is today an unaffiliated Washington, D.C.-focused facility branded as “DC News Now.”
What did the court do on Thursday? It set damages against Nexstar Media Group, and they’re in the tens of millions of dollars.
And, a Nexstar spokesperson confirms it will appeal the decision.
The court shared that, based on a mutual agreement between Nexstar and DirecTV, the direct broadcast satellite provider is owed exactly $26,623,390.57 by Nexstar.
But, Nexstar Media Group is opting to push forward with a fight that saw the Appellate Division of the Supreme Court of the State of New York in August 2024 uphold a lower state court ruling made in July 2023 against the company founded and led by Perry A. Sook.
“Nexstar will appeal,” a company representative shared in response to RBR+TVBR‘s request for comment.
Central to the case is the contention, found to be true by New York State courts, that DirecTV was never fully notified that NBC affiliation was about to end for a Nexstar TV station licensed to Hagerstown, Md. — within the sprawling Washington, D.C. DMA.
The fact that the former WHAG-25 was being stripped of its affiliation as NBCUniversal sought to eliminate dual-DMA presence of NBC stations in favor of its own WRC-4 in Washington, D.C., would have greatly impacted carriage fees paid by DirecTV to Nexstar.
In 2023, DirecTV attorney Jonathan Pressment of Baker & Hostetler first argued to the N.Y. Supreme Court that Nexstar used “force” in having DirecTV pay for a “Big Four” network affiliate even as Nexstar knew it was about to wind down the NBC affiliation of what is today WDVM “D.C. News Now.”
That court’s verdict stood when the appellate division made its ruling six months ago. Now, the Supreme Court for the State of New York seeks to resolve a question of liability.
The award as determined by the state court consists of amounts DirecTV overpaid Nexstar for retransmission consent for WHAG-TV between the time it renewed the station’s carriage deal in 2015, and Nexstar losing that affiliation in February 2016, plus interest.
“Nexstar knew of the pending loss of its NBC affiliation during our [retransmission consent] negotiations but failed to disclose it,” a DirecTV spokesperson tells RBR+TVBR. “DirecTV claimed fraudulent concealment and won.”
Still, Nexstar has a right to an appeal, and is preparing to do so as of Friday.
WDVM signed on the air in 1970. It would later become a station owned by Great Trails Broadcasting and, after that, Quorum Broadcasting. Nexstar acquired Quorum in 2003 in a $250 million transaction.
By the mid-1990s, Hagerstown and Washington County, Md., were no longer independent of the bigger Washington, D.C., DMA. As such, NBC-owned WRC-4 was given greater leverage and influence in Western Maryland; its highly popular local news team further created competition between the dual NBC affiliates.
WHAG went independent, and on July 1, 2017 changed its call sign to WDVM as a sign that it intended to serve the District of Columbia, Virginia and Maryland as a DMA-wide station. Thus, it desired full DMA carriage despite its city of license being far to the northwest of the Nation’s Capital.
In the 2015 contract with DirecTV, Nexstar included an “unlaunched station fee” provision. While DirecTV was not required to carry WHAG, it agreed to consider doing so in “good faith” and to pay license fees for WHAG based on a fixed number of subscribers as noted under this plan. But, key to DirecTV’s defense is that it only agreed to include the Unlaunched Station Fee Provision in the agreement on the basis of defendant’s “repeated assurances” that WHAG was an NBC-affiliated station.
These “assurances” come in conflict with Nexstar’s disclosure that it would launch WHAG “in the Washington, D.C., local territory,” as it is common knowledge that WRC-4 and WHAG-TV cannot both be NBC affiliates, and there was no way that NBCUniversal-owned WRC-4 would drop the NBC network.
That argument was lost in New York State Court.
