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Circle City Sues AT&T Over 'Zero' Carriage Offer

(Image credit: Future Media)

Circle City Broadcasting is suing AT&T, alleging that it is racially discriminating in contracting that is keeping its TV stations in Indianapolis from getting compensated carriage on AT&T's U-Verse or DirecTV.

The suit was filed Monday (Aug. 10) in the U.S. District Court for the Southern District of Indiana.

Circle City, which last September bought WISH-TV and WNDY-TV Indianapolis from Nexstar, is owned by Black broadcaster DuJuan McCoy.

Circle City said that while AT&T carried the stations when Nexstar owned them, it has refused to negotiate payment for carriage. 

"If a minority broadcaster desperate for carriage accepts a retransmission consent offer of zero, such as the one being offered by AT&T to Circle City, the other MVPDs that had agreed to pay fair compensation the first go-around with Circle City will naturally revert to significantly lower offers when their current deals with Circle City expire," the broadcaster told the court. "At that point, there will be a race to the bottom that ultimately puts Circle City out of business, and kills one of the best examples of Blacks’ and other minorities’ ability to succeed and lead in American media."

The suit includes an email from AT&T executive VP and chief content officer Rob Thun, in which he tells McCoy that the company "made it clear from the beginning of our discussions that, while AT&T would prefer to continue carriage of WISH and WNDY, it is our policy to not pay license fees for standalone non-Big 4 broadcast stations. We do see value to carrying WISH and WNDY, but it does not make sense for us ultimately to charge consumers for standalone non Big-4 stations that are available for free over the air and online."

In an email to AT&T CEO Randall Stephenson back in June, and in response to Stephenson's open letter for "equal justice" in response to the George Floyd killing, McCoy said: "You paid a white owned company significant fees for the same or less programming on two TV stations--WISH TV and WNDY TV. The day, I purchased the stations (9/19/19) you took me to zero.

"From Sept. - January, AT&T acted as if I they would allow me to negotiate a fair fee. So with that intention I, in good faith, let you air my product for free until January 31, 2020 when I finally realized you never had intention of compensating me.

"Both AT&T and Direct TV have now been dark on my two stations since this date!

"My only option, if you can’t help me is to continue fighting for equal treatment and ask the courts to help ....which I am very reluctant to do in this state of our environment!"

McCoy and Circle City are looking for the court to secure it "retransmission fees at a fair market rate, other lost revenue, actual and punitive damages, interest, and reasonable attorneys’ fees and costs resulting from the intentional misconduct exhibited by AT&T in violation of Circle City’s basic civil rights."

AT&T spokespeople were not available for comment at press time.