Judge blocks Nexstar’s acquisition of Tegna until antitrust suit resolved

A federal judge in Sacramento, California, has put a halt to the $6.2 billion merger between Nexstar Media Group and Tegna, pending the resolution of an antitrust lawsuit. The ruling by U.S. District Court Chief Judge Troy L. Nunley came late Friday afternoon, citing concerns raised by eight attorneys general and DirecTV regarding the potential negative impact of the merger on competition.

The proposed merger, which was announced last year and had received approval from the Federal Communications Commission, would result in the creation of a company owning 265 television stations across 44 states and the District of Columbia. These stations are mostly local affiliates of the major national networks such as ABC, CBS, Fox, and NBC.

Judge Nunley had previously issued an emergency order blocking the merger for a three-week period. Following arguments presented on April 7, he decided to extend the block until the lawsuit filed by the attorneys general and DirecTV is resolved. The plaintiffs argue that the merger could lead to higher consumer prices, diminish local journalism, and violate federal laws aimed at preventing monopolies.

New York Attorney General Letitia James expressed satisfaction with the ruling, stating that consolidating numerous local TV stations under one corporate entity could result in increased costs and reduced programming quality for consumers. Nexstar’s attorneys, however, defended the merger, pointing out that it had already been cleared by both the FCC and the Justice Department. They also highlighted commitments made by Nexstar to enhance local journalism and programming as part of the deal.

In response to the ruling, Nexstar announced its intention to appeal the decision, emphasizing that the merger had been completed over four weeks ago following regulatory approvals. The company asserted that it had taken necessary steps in compliance with the court order.

The merger required approval from the FCC under the Trump administration, necessitating waivers for rules limiting ownership of local stations by a single company. FCC Chairman Brendan Carr had previously stated that Nexstar had agreed to divest six stations as part of the approval process. The judge’s temporary restraining order noted concerns about Nexstar potentially owning multiple “Big Four” local affiliates in 31 television markets, leading to possible demands for higher broadcast fees from distributors like DirecTV.

As the legal battle continues, the fate of the Nexstar-Tegna merger remains uncertain, with potential implications for the media landscape and consumer choices in the broadcasting industry. Stay tuned for further updates on this developing story.