Through attorneys Michael DelNero and John Cobb at Covington & Burling, The Walt Disney Company last week asked the FCC to dismiss DirecTV‘s “Good Faith” complaint without delay, slamming the company poised to merge with Dish for its “baseless” filing with the Commission.
Enjoying that the DBS provider and owner of ESPN, ABC Owned Stations and cable channels under the Disney banner “have enjoyed mutually beneficial distribution arrangements for decades,” Disney counsel at Covington explained that the “complex agreements that comprise these arrangements are the product of extensive negotiations between two sophisticated businesses each seeking to serve their customers and maximize their economic position.”
This sets up Disney’s chief complaint against DirecTV: On September 7, “in the midst of active, ongoing negotiations” designed to end a bitter retransmission consent impasse, the
Good Faith complaint was filed.
For Disney, “In light of their prior agreements and the discussions and proposals being actively exchanged by the parties as part of these negotiations, The Walt Disney Company understood that DirecTV was potentially interested in including a litigation-focused ‘clean slate’ provision in the overall carriage arrangement, which includes many programming services and content licenses in addition to retransmission consent for broadcast stations. [Disney] was thus surprised and disappointed to receive the [Good Faith] complaint.”
The day after it received the complaint and realized DirecTV “had misunderstood the scope of its clean slate proposal,” Disney clarified its position and confirmed that the clean slate proposal was never intended to preclude either party from filing a complaint with the FCC, the Covington attorneys explained to the Commission.
Then came the September 14 agreement, ending the impasse and restoring all Disney-owned broadcast and cable stations to DirecTV.
As Disney’s counsel explains, “Consistent with their long standing practice, the parties’ agreement in principle includes a general clean slate release that, for clarity, will exclude this and any other FCC proceedings. As noted above, Disney proposed to DirecTV that the clean slate agreement include such a carve out, given that Disney did not contemplate that the clean slate agreement would extend to claims before the FCC. After Disney pointed that out to DirecTV — within one day of DirecTV’s filing the complaint — DirecTV could have updated the record in this proceeding.”
Given these facts, Disney wants the complaint tossed — now.
