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Tribune Media Company killed its merger with Sinclair Broadcast Group on Thursday and filed a lawsuit against the media conglomerate, claiming breach of contract.
Tribune is accusing Sinclair of using questionable negotiating tactics when it was talking to the Department of Justice and the Federal Communications Commission over regulatory requirements, according to a statement obtained by The Daily Caller News Foundation. It also said Sinclair wouldn’t sell certain media stations to assure the deal’s approval.
Lawsuit - Compensation - Losses - Result - Sinclair
The lawsuit seeks compensation for all losses incurred as a result of Sinclair’s material breaches of the Merger Agreement.
In the Merger Agreement, Sinclair committed to use its reasonable best efforts to obtain regulatory approval as promptly as possible, including agreeing in advance to divest stations in certain markets as necessary or advisable for regulatory approval. Instead, in an effort to maintain control over stations it was obligated to sell, Sinclair engaged in unnecessarily aggressive and protracted negotiations with the Department of Justice and the Federal Communications Commission (the “FCC”) over regulatory requirements, refused to sell stations in the markets as required to obtain approval, and proposed aggressive divestment structures and related-party sales that were either rejected outright or posed a high risk of rejection and delay—all in derogation of Sinclair’s contractual obligations.
FCC - Sinclair - Facts - Applications - Order
Ultimately, the FCC concluded unanimously that Sinclair may have misrepresented or omitted material facts in its applications in order to circumvent the FCC’s ownership rules and, accordingly, put the merger on indefinite hold while an administrative law judge determines whether Sinclair misled the FCC or acted with a lack of candor. As elaborated in the complaint we filed earlier today, Sinclair’s entire course of conduct has been in blatant violation of the Merger Agreement and, but for Sinclair’s actions, the transaction could have closed long ago.
The FCC states Sinclair might have also left out vital facts...
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