Review Of Comcast/TWC, AT&T/DirecTV Mergers On Hold Again Over Confidentiality Issues
Once again, the FCC has paused the 180-day clocks to review the two pending mega-mergers on its to-do list: Comcast’s acquisition of Time Warner Cable, and the marriage of AT&T to DirecTV. This time, the FCC is saying it can’t go forward with the review of these deals until a court determines whether interested parties should be granted limited access to confidential information about the involved companies.
This question of confidentiality stretches back several months to the fall of 2014. The FCC wants to make certain confidential information — which would include contracts that Comcast, TWC, and DirecTV have with broadcast and cable TV networks — available for review by attorneys of third parties with a direct interest in these mergers.
The FCC already has these documents and is free to review them on their own, but the broadcasters object to the notion of this sensitive data being shared with people outside of the Commission, even if done under high security and strict non-disclosure agreements.
The Commission first rejected a request by media companies — including CBS, Disney, Fox, Time Warner, Viacom, Univision — who then took the matter to a federal appeals court.
In Nov. 2014, the court granted a preliminary stay against the FCC making these documents available to outside parties, but allowed the Commission to continue to review them on their own, so the deals went forward.
Then on Feb. 20, the three-judge appeals court panel heard arguments from both sides regarding the necessity of sharing the information with third parties. The broadcasters claimed that the FCC would normally have taken 20 days to consider such an objection, but in this case the Commission only took five days before deciding in a 3-2 vote to move ahead with sharing the confidential info.
The FCC countered that five days was a more than reasonable amount of time to mull over the question, especially with two pending multibillion-dollar mergers waiting to be reviewed.
Until the appeals panel issues its ruling on this matter, the FCC says it can’t move forward with the final stage of reviewing these mergers.
“At this time, we believe it is prudent to pause the informal 180-day transaction clocks because the
Commission would be advantaged by knowing the resolution of the pending Petition for Review before the transaction clocks reach the 180-day mark, which both are slated to do by the end of March,” reads a statement from the FCC. “In reaching this conclusion, the Commission reserves the right to restart the clock as it believes will best serve the public interest and it intends to provide further guidance as it becomes appropriate.”
The FCC is also careful to note that the 180-day timeframe for merger reviews is merely a “good faith
undertaking” that “carries with it no procedural or substantive rights or obligations.”
In an e-mailed statement to Consumerist, Sena Fitzmaurice, VP of Government Communications for Comcast, writes:
“We understand the FCC’s decision to pause the informal review clock while the court continues to review a procedural matter related to the transaction. That case is under expedited review, oral argument occurred in late February, and a decision is expected shortly.
In the meantime, the FCC appears to be making significant progress in the review of our transaction in order to bring it to a conclusion. The comment cycle is complete, the economists have all weighed in, and the parties have responded to all of the FCC’s Requests for Information. We look forward to working with the government to complete the regulatory review process.”
UPDATE: A rep for AT&T has provided the following statement:
“We anticipate the issues surrounding the litigation between the FCC and the programmers to be resolved quickly so the FCC can complete its review of our transaction. We continue to look forward to closing our deal in the first half of the year.”
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