The much-discussed $3.9 billion acquisition of Tribune Media by Sinclair Broadcast Group Inc. is now in serious question after the discovery of undisclosed facts and relationships. A hearing has been called and many believe that Sinclair will drop its bid to avoid the highly damaging adjudication of these issues. On Wednesday, the Federal Communications Commission unanimously voted that undisclosed facts by Sinclair was enough cause for concern that it should be reviewed independently by an administrative judge. That hearing designation order raised the concern that, in light of the new information, the deal may “not be in the public interest.”
The deal would have allowed Sinclair to reach 72 percent of American households. The deal was controversial both in its legal basis and the role of FCC Chairman Ajit Pai in his communications with the company. However, even Pai joined in this decision in light of the undisclosed information.
The new information shows that companies that were supposed to be divested would actually remain connected to Sinclair or its executive chairman and controlling shareholder, David Smith. For example, Sinclair failed to reveal that WGN-TV (the much loved station for all of us Cubbie fans) would be sold to Steven Fader . However the price of $60 million seemed well below market value and it turns out that Fader has a close relationship with Smith. He is the CEO of Atlantic Automotive Group (Atlantic) and Smith hold a controlling interest in Atlantic and serves as a member of its board of directors. Atlantic is also a tenant of Sinclair’s and a major advertiser.
Likewise, Sinclair failed to disclosure that stations in Dallas and Houston that were set to be sold off to another company with cross ties: Cunningham Broadcasting.Michael Anderson , a Sinclair associate allegedly bought $400,000 worth of Cunningham shares at a rate that is viewed as well below market rate. There are also Sinclair family members involved with Cunningham and Sinclair retained the right to buy back the stations in the future, according to the FCC.
The failure to disclose this and other information is quite shocking and raises the question of potential liability beyond the loss of the acquisition. While there is no evidence of criminality thus far, the relationships could be investigated for possible fraud or insider trading or false statements to federal investigators. There is also the question of the role of counsel in signing off on disclosure representations.
Frankly, the undisclosed information in the filings is quite alarming. It is hard to believe that counsel and corporate figures thought that they could get away in withholding such information in such a high-visibility venture. In the end, they may have burned their deal, burned their allies on the FCC, and may have burned themselves in spectacular fashion.
“The failure to disclose this and other information is quite shocking” and “Frankly, the undisclosed information in the filings is quite alarming”
You’re kidding me. With conservatives controlling all facets of government (and still complaining ad nauseum about their own appointees) there is no current limit to the lies and deception they’ll commit to fully control major news medias.
“the relationships could be investigated for possible fraud or insider trading or false statements to federal investigators.” and “It is hard to believe that counsel and corporate figures thought that they could get away in withholding such information in such a high-visibility venture.”
Once again, you’re kidding me. conservatives won’t even investigate our treasonous president – and Sinclair, with their forced conservative brainwashing “commentaries” is a top favorite. Now if msnbc did similar, there would be multiple major investigations including both house and senate investigations and years of “fake news” and “lock them up” chants. But for conservative criminals? do we really think Sinclair will pay a major penalty? or have their principals or attorneys brought up on charges? or even be investigated? ………….I’d hope I’d be wrong, but consequences for intentionally lying (fraud if not a conservative)………ridiculously unlikely. More likely, Sinclair will blame others and eventually reapply for an even worse concentration of news.
Reblogged this on The Secular Jurist.
Oh hell, does this mean we don’t get to see Bill-O’s new show on Sinclair? I guess I will have to get my news from “REAL” news outlets like RT or FOX.
RT is great. Fox is at a lower level. Many people would benefit from watching RT.
Plenty of grist for liberals on RT too btw. Just not Hillarites.
Did you really admitt to that? Are you a bot with fake news?
I have come to believe that no combination of media groups is in the “public interest.”
privately owned newspapers represent the interests of the ownership.
the ownership generally establishes a range of acceptable dissent
if that spectrum is fox to cnn for example, then real red blooded nationalism is actually always going to be off limits.
it’s hard for a lot of people to “get” how fans of bernie could be fans of trump or vice versa.
ayn rand understood this and much as I dislike her nonfiction, she was right that in both right and left there is a form of “collectivism” which antithesis is found in the hyper-individualism of liberalism or what is now called liberterianism. a word she disliked in favor of her own brand of it.
liberalism was a tool of the emergent bourgeoisie, overcoming church and king
today liberalism remains a tool of the bourgeoisie; it has defeated the competitors on the socalled left ie communists and the socalled right ie national-socialists
it always doubles down on individualism and liberal ideals
what it dislikes about trump is that he has veered too far into nationalism.
nationalism was once the tool of the bourgeoisie when it was fighting the HRE
but now nationalism is a threat to the emergent global capitalist empire
DJT still is operating in the space where the USA is a sovereign with definable and legit national interests— and not the surrogate mother of the future global order
So they hate him and at the least distrust him, even socalled right wing fox
If they broadcast the Cubs they cannot be right-wing. 😉
Welllll… they can be right-wing populists.
Jean Lafitte – I would agree with populists, but not right-wing. 😉
Given the times we live in, why should anyone suppose that this deal was in any way intended to be “in the public interest”? It’s all about 1) making as much money as possible and 2) ensuring conservative control of media in an ever-larger swath of the country.
I am not familiar with Sinclairs politics.By conservative control do you mean they are a right wing media?
Some call it right wing media, others would say propaganda based on endless fabrications.
Now I am totally confused you must be talking about left wing media
2) ensuring conservative control of media in an ever-larger swath of the country.
Jay S is too emotionally disordered to process political opposition, so any news broadcasting which incorporates assumptions other than those preferred at PBS amounts to ‘conservative control of the media’, even if 90% of the media outlets are on the Pinch Sulzberger – Judy Woodruff axis.
Jay S, The republiborg collective and the CCCP…..”Corporate Controlled Conservative Press” are not going to like this. The conservative entertainment complex will scream bloody censorship.
As opposed to those famous right-wingers at Time-Warner?