Cable America Challenges Station Licenses

Cable America, a small cable operator with systems in Missouri, Arizona and California, is petitioning the Federal Communications Commission to deny license renewals to two Springfield, Mo., TV stations.

The action comes as Cable America is embroiled in a nasty retransmission consent negotiation with the two outlets, Nexstar Broadcasting’s KSFX and Mission Broadcasting-owned KOLR.

In its filings, Cable America claims the stations are being operated as a duopoly by Nexstar in violation of FCC ownership rules. “Nexstar and Mission, through a complex web of contracts and operating arrangements, have engaged in a subterfuge that violates federal law,” Cable America says in a letter to the commission.

Nexstar COO Duane Lammers says the petition is “attempted extortion” and adds that the companies have fully disclosed – and received FCC approval for – all of the company’s joint operations with Mission stations. “We’ve had other licenses upheld, and we’ve always been aboveboard,” Lammers says.

The Springfield stations' licenses are currently up for renewal, and opponents had until Jan. 3 to file challenges with the FCC.

The companies are at odds over Nexstar’s demands that cable operators pay subscriber fees to carry its stations and Mission-owned outlets. Talks deteriorated so badly that Nexstar pulled the stations’ signals off Cable America’s 8,000 subscriber system Jan. 1, and the negotiations are stalled.

Cable America says the ownership arrangement hamstrings competition, including in its retransmission negotiations. “Everything is done lockstep, uniform and spoken with one voice, and that is Nexstar’s,” says Cable America counsel Burt Braverman of Washington firm Cole, Raywid & Braverman. 

Nexstar owns 29 full-power TV stations, including KSFX. Mission owns 13 full-power stations, which Cable America notes in its petition are all located in markets with Nexstar stations.

Nexstar handles a range of functions for the Mission stations, including negotiating carriage. In some markets, the stations share a general manager and even news anchors.  “They don’t operate anywhere independently from Nexstar,” says Braverman. “Mission seems to have no other reason for being other than to help Nexstar avoid the ownership limits.” 

But Lammers is confident his stations will prevail. “We have a long fact pattern of disclosure with the FCC,” he says. “They have consistently renewed our license and approved our shared services agreements.”