Sinclair's bid to become a big national voice is dead

Photo by Andrew Harrer, Bloomberg

The sale of Tribune Media TV stations, mostly in big cities, to Sinclair Broadcast Group, which is mostly in small markets and aspired to a stronger national voice for its conservative views, is dead. And Sinclair now faces a lawsuit from Tribune over its handling of the politically charged case.

The preliminary sale agreement "allowed either party the option to withdraw if the sale did not close by Aug 8," Forbes magazine reports. "The Federal Communications Commission had put the sale on hold last month, referring the proposal to review by an administrative court. Tribune executives were wary of the notoriously long wait time for such reviews and the FCC’s history of killing similar deals."

FCC rules required Sinclair to sell 21 of the Tribune stations, including those in Dallas, Houston and Chicago, but Sinclair planned to sell those stations "to related business entities for significantly reduced prices and allowed Sinclair to retain control of them," Forbes reports. "Tribune’s lawsuit alleges that Sinclair received numerous warnings to follow contract and sell the stations in 10 different markets, minimizing financial conflicts of interest, and consistently failed to comply." The suit says Sinclair was “unnecessarily aggressive” toward the Department of Justice, threatening legal action over the agency's anti-trust reviews.

Sinclair apparently thought it had friends in the White House, since it had struck a deal in 2016 with the Trump campaign for special access and broadcasts (a deal the Clinton campaign says it turned down). But last month FCC Chairman Ajit Pai sent the issue to an administrative law judge, "often viewed as a deal-killer," Margaret McGill reported for Politico. Pai, a Trump appointee, had been friendly to the deal, reviving a regulatory loophole that would have allowed Sinclair to duck federal limits on media ownership. Sinclair already has 173 TV stations, more than any other firm, and the 42 Tribune stations would have given it access to almost three-quarters of U.S. households.