Nexstar sues Time Warner Cable over out-of-market stations

Nexstar has sued Time Warner in U.S. District Court, northern district of Texas.  Nexstar, which owns 55 TV stations, claims that Time Warner Cable is swiping its signals and rebroadcasting them to five distant markets without permission. Nexstar claims Time Warner is violating the terms of a retransmission agreement they signed in June 2009. Nexstar is seeking a temporary restraining order and injunctive relief for breach of contract and copyright infringement.

From Courthouse News Service:

“Last week, Nexstar was alerted by third parties that Time Warner had begun retransmitting signals from Nexstar stations located in Terre Haute, Indiana (i.e. the NBC affiliate, WTWO-TV); Wilkes-Barre, Pennsylvania (i.e. the NBC affiliate, WBRE-TV); and Rochester, New York (i.e. the CBS affiliate, WROC-TV) through Time Warner cable systems located in the following markets: Cincinnati, Ohio; Louisville, Kentucky; Orlando, Florida; Winston-Salem, North Carolina; and Burlington, Vermont-Plattsburgh, New York,” the complaint states. “Time Warner continues today to retransmit these signals into these distant markets – a practice known as ‘distant retransmission.'”

Nexstar claims that Time Warner never notified it of the distant retransmissions and refused to stop after receiving a cease-and-desist letter.

“The unambiguous and explicit terms of the RCA [retransmission consent agreement] – which grants Time Warner limited authorization to retransmit the signals of Nexstar television stations, including WTWO, WBRE and WROC, within each station’s local market – demonstrates the illegality of Time Warner’s conduct,” the complaint states. “The RCA shows that Nexstar never authorized Time Warner to retransmit any of its stations’ signals – let alone the signals WTWO, WBRE and WROC into markets hundreds of miles distant.”

Nexstar claims Time Warner is not paying it for the retransmissions, as the contract does not provide for pay based on the number of Time Warner subscribers in the distant markets. It also claims the rebroadcasting of news programs violates its copyrights.

Nexstar also said that retransmission of WBRE into Winston-Salem has resulted in the same syndicated programming being shown by WBRE and another station in the area, at the same times, confusing viewers about what station they are watching.

“This violates the rules of the FCC and, among other reasons, is likely one reason why Time Warner has not distantly retransmitted Nexstar programming into Orlando, Cincinnati, Winston-Salem, Plattsburgh-Burlington or Louisville for the three years that the RCA has been in effect,” the complaint states.

A call to Nexstar CEO Perry Sook had not been returned at deadline.

After extending talks beyond the original expiration of their retransmission consent contract with Time Warner Cable on 7/1, all Hearst O&O stations except one (WISN-ABC Milwaukee) are dark across the country on the MSO’s systems. Negotiations broke down because, according to Time Warner, Hearst wants a 300% increase in compensation for its stations’ programming on TWC systems across the country. Hearst stations pulled their signals at midnight on 7/10. Negotiations had continued during the extension period that Hearst had granted through 7/9.

The Hearst stations that are not currently being carried by Time Warner Cable include: WTAE-ABC Pittsburgh, WLWT-NBC Cincinnati, KITV-ABC Honolulu; WCVB-ABC Boston; WMTW-ABC Portland ME; WNNE-NBC Hartford VT/Hanover, NH; WPTZ-NBC Plattsburg NY; WPTZ-D2 -This TV Plattsburgh NY; WXII-NBC Winston-Salem NC; KCWE-CW and KMBC-ABC Kansas City MO; KETV-ABC Lincoln NE and WLKY-CBS Louisville.

So TWC made arrangements to bring national network programming in some of its markets from Nexstar stations in other cities, including: WLKY with WROC Rochester, NY (CBS); WLWT with WTWO Terre Haute IN (NBC); and WNNE, WPTZ and WXII with WBRE Wilkes Barre, PA (NBC).

Shortly afterward, Nexstar filed an emergency petition with the FCC, saying Time Warner was in violation of the Federal Communications Act and rules concerning carriage changes lineups. The TV group asked for an immediate injunction and asked the commission to sanction TWC.

Time Warner reportedly said it is completely authorized by its retransmission agreement with Nexstar to pick up the stations.

See The Courthouse News story here.

RBR-TVBR observation: It’s starting to look a bit like the television groups are willing to help each other out in order to get the retransmission deals they want with the MSOs. In this case, it all boils down to the explicit language of the June 2009 RAC contract. But it looks like TWC definitely should have notified Nexstar before moving ahead with distant retransmission of signals. It could have also been that the contract stated retransmission of distant signals was OK in the case of an outage at the local market station.