Federal Judge Halts Nexstar’s $6.2 Billion Acquisition of Tegna Amid Antitrust Concerns

An injunction blocking the Trump-supported creation of an unprecedented local television monopoly is headed for the Ninth Circuit Court of Appeals after a federal judge raised doubts about the legality of Nexstar Media Group’s $6.2 billion takeover of rival broadcaster Tegna Inc. Chief Judge Troy L. Nunley of the U.S. District Court for the Eastern District of California issued the preliminary injunction late Friday. The ruling forces Nexstar to operate its 65 newly acquired Tegna stations separately from its existing portfolio. If Nexstar ultimately loses an upcoming trial, it may be forced to completely unwind the transaction.The lawsuit to block the merger was spearheaded by DirecTV and eight Democratic attorneys general. They argue that the consolidation will stifle local journalism, lead to mass layoffs, and drive up prices for consumers by giving Nexstar outsized leverage to demand higher broadcast fees.In his ruling, Judge Nunley noted that the plaintiffs “demonstrated a prima facie case that the merger creates a ‘reasonable probability of anticompetitive effect.'”If finalized, the acquisition would give Nexstar control of 265 television stations across 44 states and the District of Columbia. Reaching 80 percent of U.S. households, the portfolio vastly exceeds standard federal competition limits.The merger initially received swift clearance from the Department of Justice and the Federal Communications Commission during the Trump administration. Regulators required minimal concessions, granting waivers that allowed Nexstar to bypass standard ownership limits.Judge Nunley highlighted the irregularity of this regulatory green light. “In unusual circumstances — with the FCC’s quasi-adjudicatory licensing proceeding still pending — the President himself weighed in publicly in February and urged federal regulators to approve the deal to ‘knock out the Fake News,’” the judge wrote in his ruling.FCC Commissioner Anna Gomez, a Democrat, heavily criticized the expedited approval process, saying, “The FCC and other government agencies have used what is now recognized as the Billionaire Buddy Bypass to grant expedited, closed-door approval to powerful friends of this administration.”Despite the FCC’s clearance, Judge Nunley rejected the premise that the agency’s approval negated antitrust concerns. “The FCC was ‘not given the power to decide antitrust issues,’ and FCC action ‘was not intended to prevent enforcement of the antitrust laws in federal courts,'” he wrote.Addressing the potential impact on media workers, Judge Nunley added, “The Court agrees with Plaintiffs that Defendants’ integration efforts are exactly those that would make it more difficult to divest TEGNA stations, as they will eliminate competition and result in newsroom layoffs and shutdowns.”Nexstar pushed back against the ruling, announcing plans to appeal to the Ninth Circuit Court of Appeals. The company released a statement Friday evening defending the merger:“This transaction closed more than four weeks ago following receipt of all required regulatory approvals from the Federal Communications Commission and the U.S. Department of Justice,” Nexstar said in a statement. “Nexstar Media Group now owns TEGNA and has taken steps consistent with the Court order that has been in effect. For nearly thirty years, Nexstar has provided free over-the-air access to all its broadcast stations — local news, weather, and community-focused programming alongside major network programming. This pro-competitive transaction will make local stations stronger and support continued investment in local journalism and fact-based news,” the statement said.

Federal Judge Halts Nexstar’s $6.2 Billion Acquisition of Tegna Amid Antitrust Concerns

Federal Judge Halts Nexstar’s $6.2 Billion Acquisition of Tegna Amid Antitrust Concerns

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