D.C. Court denies request to block UHF discount, removes hurdle for Sinclair-Tribune merger

justice scales and gavel
After temporarily placing an administrative hold on the FCC’s plans to reinstate the UHF discount for broadcasters, the D.C. Court of Appeals has unblocked the return of the rule. Image: Getty/BrianAJackson

After temporarily placing an administrative hold on the FCC’s plans to reinstate the UHF discount for broadcasters, the D.C. Court of Appeals has unblocked the return of the rule.

Earlier this month, the Court responded to an emergency motion by issuing an administrative stay, saying that the stay would provide sufficient opportunity to consider the emergency motion for stay pending review.

Now, after considering, the Court has decided to allow the FCC to follow through on its plans.

RELATED: Free Press, others urge court to stay return of the FCC’s UHF discount

The brief halt to the UHF discount’s return came as a result of a group of petitioners filing for an emergency stay. The Institute for Public Representation filed the emergency motion on behalf of Free Press, Media Mobilizing Project, Prometheus Radio Project, National Hispanic Media Coalition and Common Cause. The FCC was given until June 1 to respond, and did so by asking the Court to not issue a stay.

Free Press Policy Counsel Gaurav Laroia condemned the Court’s decision.

“We're disappointed by the court's decision to deny the stay, but still plan to show the unlawful nature of the FCC's arbitrary and capricious decision under review in this case,” said Laroia in a statement. “Chairman Pai's decision to revive this obsolete rule would allow broadcast consolidation far beyond the already high limits set by Congress. And that would grease the skids for companies like Sinclair to cash in, acquiring other media conglomerates like Tribune with the merger those two companies proposed last month. Runaway broadcast consolidation at the national and local level is bad for competition, diversity and localism in broadcasting. Sinclair's practices are a prime example of how consolidation undermines those three principles, with its penchant for dictating coverage to local affiliates and intervening in the editorial decisions of the stations it owns.”

Sinclair last month announced its plans to acquire Tribune Media’s 42 TV stations — and the company’s cable network assets — in a deal valued at $3.9 billion. The deal was believed to hinge on whether the UHF discount, which allows broadcasters to count UHF stations at 50% toward the 39% national ownership cap, was reinstated.

Sinclair cheered the decision by the Court to deny the emergency stay.

“We are pleased that the Court denied the motion for an emergency stay of a rule that had been in effect for decades.  We remain confident that the Court will conclude on the merits that the UHF discount should remain in place until a thorough review of the current ownership rules is completed,” said the company in statement.

When the FCC in April announced its intention to bring back the UHF discount, which was discontinued in 2016 by the previous FCC under Tom Wheeler, The National Association of Broadcasters was quick to applaud the move.

"NAB supports today's FCC action reinstating the UHF TV station ownership discount and commends Chairman Pai for his leadership on this issue. This represents a rational first step in media ownership reform policy allowing free and local broadcasters to remain competitive with multinational pay TV giants and broadband providers," said NAB President and CEO Gordon Smith in a statement.