Federal Register/Vol. 84, No. 106/Monday, June 3, 2019/Notices
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Federal Register / Vol. 84, No. 106 / Monday, June 3, 2019 / Notices 25573 DEPARTMENT OF JUSTICE and Plan of Merger pursuant to which April 5, 2019. The United States Gray would acquire Raycom for received one comment, which is Antitrust Division approximately $3.6 billion. On described below in Section IV, December 14, 2018, the United States concerning the allegations in the United States v. Gray Television, Inc., filed a civil antitrust Complaint seeking Complaint (Exhibit 1). et al.; Response to Public Comment to enjoin Gray and Raycom (collectively, II. THE COMPLAINT, THE HOLD ‘‘Defendants’’) from carrying out the Notice is hereby given pursuant to the SEPARATE, AND THE PROPOSED merger. The Complaint alleges that the Antitrust Procedures and Penalties Act, FINAL JUDGMENT 15 U.S.C. 16(b)–(h), that one comment merger would substantially lessen The Complaint alleged that Gray’s was received concerning the proposed competition in the markets for the acquisition of Raycom would Final Judgment in this case, and that licensing of ‘‘Big 4’’ television substantially lessen competition in the comment together with the Response of retransmission consent and the sale of licensing of Big 4 television Plaintiff United States to Public broadcast television spot advertising in retransmission consent and in the sale Comment on the Proposed Final each of nine Designated Market Areas of broadcast television spot advertising Judgment have been filed with the (‘‘DMAs’’) in which Gray and Raycom in the Overlap DMAs. The proposed United States District Court for the each owned an affiliate of a ‘‘Big 4’’ Final Judgment remedies this concern District of Columbia in United States of television network (i.e., an NBC, CBS, by requiring the Defendants to divest America v. Gray Television, Inc., et al., ABC, or FOX affiliate). These nine the Big 4 stations owned by either Gray Civil Action No. 1:18–cv–02951–CRC. DMAs (the ‘‘Overlap DMAs’’) are: (i) Waco-Temple-Bryan, Texas; (ii) or Raycom in each Overlap DMA. Copies of the comment and the United Without the proposed remedy, Gray’s States’ response are available for Tallahassee, Florida-Thomasville, Georgia; (iii) Toledo, Ohio; (iv) Odessa- acquisition of Raycom would have inspection on the Antitrust Division’s resulted in the combined company website at https://www.justice.gov/atr Midland, Texas; (v) Knoxville, Tennessee; (vi) Augusta, Georgia; (vii) owning an additional Big 4 station in and at the Office of the Clerk of the each Overlap DMA. United States District Court for the Panama City, Florida; (viii) Dothan, Alabama; and (ix) Albany, Georgia. Big 4 stations usually are the stations District of Columbia. Copies of these Simultaneously with the filing of the in each DMA ranked highest in terms of materials may be obtained from the Complaint, the United States filed a audience share and ratings, largely Antitrust Division upon request and proposed Final Judgment and a Hold because of unique offerings such as payment of the copying fee set by Separate Stipulation and Order (‘‘Hold local news, sports, and highly ranked Department of Justice regulations. Separate’’) signed by Plaintiff and primetime programs. Due to these Patricia A. Brink, Defendants consenting to entry of the features, multichannel video Director of Civil Enforcement. proposed Final Judgment after programming distributors (‘‘MVPDs’’), compliance with the requirements of the such as cable and satellite television UNITED STATES DISTRICT COURT Tunney Act, 15 U.S.C. § 16(b)–(h). providers, regard Big 4 broadcast FOR THE DISTRICT OF COLUMBIA Pursuant to those requirements, the stations as highly desirable for inclusion United States of America, Plaintiff, v. Gray United States filed a Competitive Impact in the packages they offer subscribers. Television, Inc., and Raycom Media, Inc., Statement (‘‘CIS’’) on December 14, Viewers typically consider Big 4 Defendants. 2018, describing the transaction and the stations to be close substitutes for one Case No. 1:18–cv–02951–CRC proposed Final Judgment. 15 U.S.C. § another. If an MVPD suffers a blackout 16(b). The United States published the of a Big 4 station in a given DMA, many RESPONSE OF PLAINTIFF UNITED Complaint, proposed Final Judgment, of the MVPD’s subscribers are likely to STATES TO PUBLIC COMMENT ON and CIS in the Federal Register on turn to other Big 4 stations in the DMA THE PROPOSED FINAL JUDGMENT February 1, 2019, see 84 Fed. Reg. 1,216 to watch similar content. The As required by the Antitrust (2019), and caused summaries of the combination of Gray’s and Raycom’s Big Procedures and Penalties Act (the proposed Final Judgment and CIS, 4 stations would have increased the ‘‘APPA’’ or ‘‘Tunney Act’’), 15 U.S.C. § together with directions for the combined company’s bargaining 16(b)–(h), the United States hereby submission of written comments related leverage against MVPDs in the Overlap responds to the one public comment to the proposed Final Judgment, to be DMAs, likely leading to increased received by the United States about the published in The Washington Post for ‘‘retransmission consent’’ fees, which proposed Final Judgment in this case. seven days, from February 4, 2019, generally are passed on to MVPD After careful consideration of the through February 10, 2019,1 see 15 subscribers. submitted comment, the United States U.S.C. § 16(c). The 60-day public In addition to licensing continues to believe that the proposed comment period required by the Tunney retransmission consent, broadcast remedy, as described in the proposed Act, 15 U.S.C. § 16(b)–(d), ended on television stations sell advertising Final Judgment, will address the harm ‘‘spots’’ during breaks in their alleged in the Complaint and is 1 Though not expressly required to do so by the programming. An advertiser purchases therefore in the public interest. The Tunney Act, the United States also caused these spots from a broadcast station in order summaries of the proposed Final Judgment and CIS, to reach viewers within the DMA in United States will move the Court for and directions for submission of written comments, entry of the proposed Final Judgment to be published for seven days over a period of two which the broadcast station is located. after the public comment and this weeks in 11 other newspapers that are widely read From an advertiser’s perspective, response have been published in the in the Overlap DMAs: The Albany Herald, The broadcast television spot advertising Augusta Chronicle, the Dothan Eagle, the Waco possesses a unique combination of Federal Register pursuant to 15 U.S.C. Tribune-Herald, The Knoxville News-Sentinel, the § 16(d). Midland Reporter-Telegram, The Odessa American, attributes that sets it apart from other The News Herald (published in Panama City, kinds of advertising. Gray and Raycom I. PROCEDURAL HISTORY Florida), the Tallahassee Democrat, The Blade compete to sell broadcast television On June 23, 2018, Gray Television, (published in Toledo, Ohio), and The Valdosta advertising in each of the Overlap Daily Times. The last date of publication of the Inc. (‘‘Gray’’) and Raycom Media, Inc. materials in any of these newspapers was February DMAs. Without the divestiture of a Big (‘‘Raycom’’) entered into an Agreement 19, 2019. 4 station in each Overlap DMA, VerDate Sep<11>2014 16:26 May 31, 2019 Jkt 247001 PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 E:\FR\FM\03JNN1.SGM 03JNN1 jbell on DSK3GLQ082PROD with NOTICES 25574 Federal Register / Vol. 84, No. 106 / Monday, June 3, 2019 / Notices advertisers would have fewer broadcast January 2, 2019 Gray consummated its adequacy of such judgment that the television alternatives, likely resulting acquisition of Raycom. court deems necessary to a in increased prices for broadcast The Hold Separate and the proposed determination of whether the consent television spot advertising. Final Judgment were filed with the judgment is in the public interest; and On August 22, 2018, the Defendants court on December 14, 2018. Under the (B) the impact of entry of such provided the United States with proposed Final Judgment, the judgment upon competition in the executed asset purchase agreements Defendants are required to divest the relevant market or markets, upon the under which the Defendants proposed television stations set forth in the public generally and individuals to divest the following Big 4 stations: proposed asset purchase agreements and alleging specific injury from the (a) Raycom-owned KXXV and KRHD- all assets necessary for their operation violations set forth in the complaint CD, the ABC affiliates in the Waco- as viable, ongoing commercial broadcast including consideration of the public Temple-Bryan, Texas, DMA, and WTXL- television stations.2 The proposed Final benefit, if any, to be derived from a TV, the ABC affiliate in the Tallahassee, Judgment requires that these assets be determination of the issues at trial. Florida-Thomasville, Georgia, DMA to divested to one or more acquirers 15 U.S.C. § 16(e)(1)(A) & (B). In the E.W. Scripps Company or its acceptable to the United States, in its considering these statutory factors, the subsidiaries (collectively ‘‘Scripps’’); sole discretion. On December 31, 2018, court’s inquiry is necessarily a limited (b) Raycom-owned WTOL, the CBS and January 2, 2019, Gray sold the one as the government is entitled to affiliate in the Toledo, Ohio, DMA, and divestiture assets set forth in the ‘‘broad discretion to settle with the KWES-TV, the NBC affiliate in the proposed Final Judgment to Scripps, defendant within the reaches of the Odessa-Midland, Texas, DMA to TEGNA, Lockwood, and Marquee, as public interest.’’ United States v. TEGNA Inc. or its subsidiaries approved by the United States. On Microsoft Corp., 56 F.3d 1448, 1461 (collectively ‘‘TEGNA’’); January 2, 2019, Gray consummated its (D.C.