Adell CEO Urges Mission to Accept FCC Conditions, Threatens Legal Action

Adell won’t extend the deal’s June 30 breakup date if Mission hasn’t agreed to the conditions by then, and also won’t participate in an appeal of the FCC’s order unless the agreement is complete, he added. Without the completed WADL sale, Nexstar’s CW network won't have an outlet in Detroit, Adell said. “He needs me, I don’t need him,” Adell said of Nexstar CEO Perry Sook.

Nexstar and Mission both declined comment. Mission had proposed to buy WADL with financing guaranteed by Nexstar, and planned for Nexstar -- which already owns the maximum number of stations that it can under the nationwide ownership cap -- to operate WADL and collect revenue from it.

Adell laid out his intent not to extend the deal in a recent letter to Mission CEO Dennis Thatcher, he told us. The WADL buy had been pending at the FCC since May 2023 prior to the Media Bureau order last month, which conditioned approval on Nexstar greatly reducing its planned influence over the station. The conditions include barring Nexstar from receiving all the station’s revenue, providing the majority of its content, and negotiating retransmission consent for WADL.

If Mission doesn’t accept the conditions, the Media Bureau said it would designate the matter for hearing, a proceeding that would likely take years and could expose Nexstar or Mission to having licenses revoked, broadcast attorneys told us. Nexstar and Mission shouldn’t treat Adell Broadcasting like it's a small company, Adell said. He also owns African American religious network The Word, a 50,000 watt radio station, and other holdings. “I’m not Johnny One-Stick,” he said.

Adell also said that if the deal breaks up, he wouldn't participate in Mission efforts to appeal the FCC’s decision. Broadcast attorneys told us the avenues for appeal are somewhat murky. Moreover, it's unclear how much practical effect an appeal would have, they said. One attorney called it “uncharted procedural territory.” The order approving the transaction isn’t a hearing designation order (HDO) but rather says that one would be issued if the conditions aren’t met. An appeal would go to the full FCC, and it's seen as unlikely that three commissioners would support overturning the Media Bureau’s action. Such an appeal must be filed shortly before the end of May, according to FCC rules.

A designation for hearing isn’t considered final agency action and the courts have traditionally rejected attempts to appeal such matters before the hearing proceeding has completed -- the U.S. Court of Appeals took that position on Standard General’s appeal of an HDO last year (see 2304040063).

The parties could challenge the FCC’s entire hearing process or enforcement structure based on recent U.S. Supreme Court administrative law decisions, but that would be new territory, and it isn’t clear how such challenges would proceed, attorneys told us. FCC Commissioner Brendan Carr recently cited the WADL order as an “overreach” that could draw such challenges (see 2405030066), speaking at an event broadcast law firm Wiley sponsored. Wiley represents Nexstar and Adell Broadcasting.

If Adell and Mission’s deal broke down, then it is likely that a hearing proceeding or appeal would be invalidated. “Because the merger arrangement has been dissolved and the underlying FCC applications are being withdrawn to the extent technically possible, the issues designated for hearing are moot,” ruled Administrative Law Judge Jane Halprin on the Standard General/Tegna proceeding. If the hearing proceeding concerned character issues such as whether Nexstar or Mission is the real owner of Mission’s stations, the deal dissolving might not lead to the hearing ending, said broadcast attorney Arthur Belendiuk, a veteran of the HDO process. That could put Mission or Nexstar's licenses in danger, which Belendiuk called a "dumb" risk.

If the agreement falls apart, then Adell plans to take Nexstar and Mission to court, he told us. Mission and Nexstar were required to make their best efforts at cooperating with the FCC and informing Adell that the FCC was investigating them, Adell said. He said he would sue them for failing to preserve the deal and for fraud over concealing from him the severity of the investigations. “They had a duty to tell me they were being investigated,” Adell said. “I don’t hide in dark corners.” Adell said he cooperated with the investigation and met with Media Bureau Chief Holly Saurer and Chairwoman Jessica Rosenworcel, which he compared to “playing baseball with Mickey Mantle.” Mission refused to join those meetings, Adell said.