Broadcasters' New Court Filing Says Retrans Documents ‘Most Closely Guarded Secrets'

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By Lydia Beyoud

Dec. 16 — Retransmission consent agreements are among media companies' “most closely guarded secrets” and therefore should be prohibited from disclosure to third parties as part of the FCC's merger review process, CBS Corp. and others said in briefs filed late Dec. 15.

The briefs are the latest round in a legal tussle between CBS, Twenty-First Century Fox Corp., Viacom Inc. and other media companies and the Federal Communications Commission, which wants to give third parties the ability to review thousands of pages of confidential video programming documents to help inform its antitrust review of the proposed mergers between AT&T Inc. and DirecTV, and between Comcast Corp. and Time Warner Cable Inc., which also involves Charter Communications Inc.

In an intervenor brief, the National Association of Broadcasters, the trade association that represents the petitioners, said the revenues from retransmission agreements between TV stations and pay TV providers “are increasingly important to many stations' profitability.” Such revenues are projected to reach $9.3 billion annually by 2020, while broadcasters are expected to earn about $4.9 billion from them in 2014, according to SNL Kagan.

Pay TV organizations, including Dish Network and the American Cable Association, could gain an industry-wide perspective of contract agreements and negotiation strategies if allowed to review the documents, NAB said.

The FCC said in previous briefs prior to the U.S. Court of Appeals for the District of Columbia Circuit granting a stay of disclosure on Nov. 21 that it had put in place adequate measures to safeguard the highly confidential information.

Trade Secrets Act Invoked

In their brief, the petitioners said their video programming confidential information (VPCI) is protected by the Trade Secrets Act and may not be disclosed unless the FCC can make a persuasive showing that disclosure is necessary—a test, they said, that the agency hasn't met.

They also said the FCC hadn't provided adequate limits on who may review the VPCI, although it had placed restrictions in its protective orders on how the documents could be reviewed. Additionally, petitioners said the FCC hadn't adequately explained why it rejected their proposed measures, including redaction and data aggregation, to provide greater protection to the confidential documents.

The stay of disclosure remains in effect throughout the duration of the proceeding, though the FCC announced Dec. 3 it would immediately allow third parties to review media content companies' highly confidential information that isn't covered under the stay.

To contact the reporter on this story: Lydia Beyoud in Washington at lbeyoud@bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com

Text of the petitioners' brief of CBS et al. is at http://www.bloomberglaw.com/public/document/CBS_Corporation_et_al_v_FCC_et_al_Docket_No_1401242_DC_Cir_Nov_13/4.

Text of the NAB's brief is at http://www.bloomberglaw.com/public/document/CBS_Corporation_et_al_v_FCC_et_al_Docket_No_1401242_DC_Cir_Nov_13/3.