Kim: May 22 Will Be 'Midnight for Cinderella' for Standard/Tegna
The FCC’s Democrats haven't agreed to meet with Standard General, May 22 will be “like midnight for Cinderella” for the company’s deal to buy Tegna, and the transaction’s likely dissolution could affect confirmation prospects for FCC Commissioner Geoffrey Starks, Standard General executives and supporters said during a Monday news conference. “We know that there are senators who are openly now, like Sen. Menendez on the floor (see 2304260066), saying that those who hurt the chances of diversity in media will face a harsh and unlikely confirmation,” said Cedric Richmond, a senior adviser to the Democratic National Committee, during the news conference, referring to New Jersey's Democratic Sen. Bob Menendez. The deal’s end date comes in two weeks, Standard emphasized in a news release Monday that called the news conference “a final push.”
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Standard has sent out multiple news releases about Menendez’s comments, but Standard Managing Partner Soohyung Kim said Monday the company isn’t threatening Starks’ job. “I mean, we don’t have the power to get our application approved, what power do we have to threaten?” Kim said. Oversight of the FCC is part of Congress’ purview, said former FCC aide Adonis Hoffman, also supporting Standard General at the news conference. Oversight, “looking at this narrow case where it seems like the commission has departed from long-standing procedure and precedent, would be appropriate,” he said. Hoffman was one of Standard’s candidates for the board of Tegna during an unsuccessful proxy fight in 2021 (see 2103090064). Starks and Chairwoman Jessica Rosenworcel didn’t comment.
Starks isn't expected to break with Rosenworcel or seek a vote on the deal, numerous FCC attorneys told us. The Standard/Tegna agreement contains provisions requiring both companies to make every reasonable effort to get regulatory approval for the transaction, and some attorneys said litigation on that issue could follow the deal’s breakup. After the unsuccessful Sinclair/Tribune agreement was designated for hearing and dissolved, Tribune sued Sinclair for breach of contract in 2018 and argued Sinclair hadn’t tried hard enough to answer regulatory concerns. That case was resolved in 2020 with a settlement involving a $60 million payout and the sale of a TV station to Tribune’s then-new parent company Nexstar. Tegna didn’t comment.
Standard General said it sought meetings with all four FCC commissioners last week, but Rosenworcel and Starks didn't agree to meet. An FCC spokesperson emailed that Standard's meeting requests were under legal review. The deal has an ongoing hearing proceeding before the agency's administrative law judge. “We've been pressing for meetings with the commissioners,” Kim said Monday. “During this whole time we've not received any feedback at all. ... I think it's relatively standard for applicants or to have a chance to explain oneself or ameliorate any issues.”
During Monday’s news conference, Standard and deal supporters also emphasized previous statements from Starks and Rosenworcel backing increased diversity in broadcasting. “Democratic commissioners have talked and specifically stated that increasing diversity in media ownership is one of their biggest goals,” said Richmond. Standard announced Monday it reached a memorandum of understanding with several civil rights groups that outlines “a five-part diversity, equity, and inclusion action plan” that would take effect after the Standard/Tegna deal closes. Under the MOU, Standard would increase diverse supplier spending, prioritize minority audience participation, and develop a community investment plan for minority-led organizations. The civil rights groups signed on to the MOU include the National Urban League, Asian Americans Advancing Justice and Al Sharpton’s National Action Network.