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Appeals Court Affirms Decision to Deny Nexstar Injunction Against Time Warner Cable

TV stations may want to re-read their retrans contracts to
see whether they, too could be subject to distant signal importations. The U.S.
Court of Appeals has denied motions for a stay and injunction against Time
Warner Cable for retransmitting Nexstar distant signals, agreeing with a Texas
district court that Nexstar is not likely to succeed on the merits of its
breach of contract claim against Time Warner Cable.

Nexstar said that the language in its retrans consent
agreement (RCA) did not apply to delivering signals outside a market, while TWC
said it granted broad carriage rights.

The Texas district court, in denying to enjoin Nexstar,
agreed with TWC that the contract provided those broad rights and the Fifth
Circuit affirmed that decision this week.

"[T]he plain language of the RCA grants Time Warner
broad authority to retransmit Nexstar signals on Time Warner stations (sic)," the appeals court said in
the May 30 decision.

Parsing that plain language, the court said that "[Nexstar]
hereby gives [Time Warner] the nonexclusive retransmission of the entire
broadcast signal of each Station (the 'Signal') over each System pursuant to
the terms of this Agreement," meant TWC could retransmit the signals on
any or all of its systems, not just the one serving the relevant market.

A Texas district judge last fall denied Nexstar's request
for a temporary restraining order (TRO) against Time Warner Cable and signaled
Nexstar is unlikely to win its suit charging the cable operator impermissibly
imported Nexstar signals into distant markets to substitute for Hearst TV
stations that had gone dark there due to a retrans fight with TWC.

Hearst and TWC settled their dispute not long
after the suit and TRO request were filed, so the TRO was essentially moot, but
Nexstar was charging copyright infringement and the decision suggests TWC is
free to import those Nexstar signals again if it runs into a retrans impasse in
those or other markets.

"The Court of Appeals decision affirmed the district court judge in all respects in finding that Nexstar was not likely to prevail in its breach of contract and copyright case, since our retransmission consent agreement clearly gives us the right to carry Nexstar signals in distant markets," TWC said in a statement.