News and Analysis
AT&T is close to a settlement with the Justice Department to resolve the government’s claim that DIRECTV (now owned by AT&T) engaged in an illegal campaign to prevent SportsNet LA from being carried by the major TV providers in the Los Angeles market, reports The Los Angeles Times.
However, The Times writes that the settlement will likely not require DIRECTV or AT&T to carry SportsNet LA, which is the exclusive TV home of the Los Angeles Dodgers. Instead, the agreement will force the pay TV providers to no longer share private information with other cable or satellite services.
The Justice Department lawsuit alleged that DIRECTV served as a ‘ringleader’ to persuade other providers not to carry the channel as well. The satcaster, the suit says, shared confidential information with its rivals to help persuade them from carrying it.
If the Los Angeles Times report is true, it says here that the settlement will be a significant capitulation by the Justice Department, and a major defeat for home viewers of the Los Angeles Dodgers.
Since its launch in 2014, DIRECTV and most other major TV providers in the LA area have refused to carry SportsNet LA, saying its carriage fee is excessive. The only major providers that have agreed to carry it are Time Warner Cable (now Charter) and Charter itself. (TWC, which is now owned by Charter, agreed to pay the Dodgers $8.35 billion over 25 years for the broadcast rights to the Dodgers games.).
However, the lawsuit, which was filed a few days before the 2016 presidential election, was seen by some observers (including yours truly) as leverage to get DIRECTV to carry the regional sports channel.
The Justice Department had obtained enough damaging information on DIRECTV’s questionable maneuvering that it could use the complaint to exact a carriage agreement before settling the case.
In addition, AT&T was under pressure to make peace with the feds because of its proposed merger with Time Warner, which now needs approval by the Justice Department itself.
(Why would the feds care about the Dodgers? Numerous Democratic politicians from California had been pushing federal officials to cajole DIRECTV to carry SportsNet LA. Also of note: Several prominent members of the Los Angeles Dodgers’ ownership team are Democrats who have made sizable contributions to now former President Obama and other high-ranking Democrats. It’s not a stretch to conclude that the Obama-led Justice Department was encouraged to help out by filing the lawsuit, which many experts deemed shaky on the legal merits.)
So what changed for the Justice Department to walk away without carriage in hand, if indeed that’s what happens?
President Trump’s upset victory in November changed everything.
Under a Clinton administration, the Justice Department undoubtedly would have proceeded with the lawsuit until it got what it wanted. (There was even talk that President Obama’s Attorney General, Loretta Lynch, would stay in her post under Mrs. Clinton.) It was good for the party to follow suit, so to speak.
But for President Trump, the lawsuit was just a leftover from an administration he doesn’t like or respect. And the Jeff Sessions-led Justice Department certainly doesn’t care about helping out the Dems in California, and it has no stake in helping out the Dodgers, either.
My analysis is that the Justice Department is looking to walk away now without landing the big quarry (carriage) simply because the lawsuit is no longer a political priority.
— Phillip Swann