Sinclair-Tribune remains the non-deal that refuses to die. The proposed merger has long since been scrapped, deteriorating into suits and counter-suits while Tribune has moved on to Nexstar. But the story line continues to play out on a couple of fronts.
The American Cable Association has responded to Sinclair's opposition to ACA's petition last month that the FCC require Sinclair to file for early renewal of four of its television stations.
ACA had filed the petition pointing to the as-yet unresolved issue of whether and, if so, to what extent Sinclair misled the commission about the stations it was spinning off to try and get the Tribune deal approved. Deceiving the commission is a character issue that could implicate fitness for holding a station license.
Sinclair fired back that ACA lacked standing to seek that early renewal, and that at any rate had not alleged anything that would constitute a "serious" or "compelling" reason to require WJLA-TV Washington, WBFF(TV) Baltimore, WSET-TV Lynchburg, or WTVZ-TV, Norfolk, both Virginia, to file early.
But ACA said the FCC found that there was a “substantial and material question of fact” as to whether Sinclair had lied about its divestitures and, if it had, that would definitely call into question its qualifications to hold any licenses, including the ones it sought early renewal reviews for.
"Sinclair’s truthfulness generally—not with respect to particular licenses—was 'at issue' in the Tribune-proceeding. And it will be 'at issue' in every future transaction or license renewal, because the Commission must designate an application for hearing if there is an unresolved question about the applicant’s qualifications—which will in turn require an administrative law judge to resolve them," ACA said.
Citing potential misrepresentation and lack of candor, the FCC voted unanimously to refer the deal to its Administrative Law Judge for an evidentiary hearing on those allegations, saying that some TV station spin-offs could still leave Sinclair in effective control of some of those station.
The FCC's five commissioners voted unanimously to designate the hearing--basically a death sentence for a merger--because of concerns that Sinclair had not accurately represented its ties to the third parties to which it planned to spin off stations.
But after the deal was withdrawn, the FCC signaled it would be OK if the hearing did not go forward, and there has been no action out of the ALJ's office since mid-summer, short of a new ALJ replacing Judge Richard Sippel--the FCC only has one ALJ--who had reportedly been ill for some time.
Which brings in the other loose end in the doomed deal. There was still no answer at press time from the offices of the new FCC Administrative law judge, Jane Hinckley Halprin, who presumably--the chairman's office does not comment on the ALJ--must either conduct the designated hearing into Sinclair's truthfulness or drop it, the latter which the FCC's Enforcement Bureau has signaled would be OK.
If the hearing is dropped, it will leave the character issue unresolved and fodder for future station challenge efforts from Sinclair critics. So it would probably be in Sinclair's best interest to have that character "overhang" addressed since it says it did nothing wrong.
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