Cable company denies bad-faith negotiation over dropping Washington station from lineup
By Sally Voth -- email@example.com
EDINBURG -- Shentel Communications has struck back at Allbritton Communications Co.'s allegations that it engaged in bad-faith negotiations regarding retransmission fees for WJLA-7.
Allbritton Communications Co., which operates ABC 7 as well as Politico, a political newspaper and website, filed an emergency Federal Communications Commission petition last Thursday.
Shentel announced late last month it was dropping WJLA from Shenandoah County subscribers' cable lineup at the end of 2011 after failing to negotiate an acceptable price for the Washington affiliate of ABC. That left another ABC affiliate, Harrisonburg's WHSV, still available to viewers.
In its FCC petition, Allbritton accuses Shentel of reneging on its own offer submitted Nov. 10.
"On December 28, 2011, Shentel indicated its intention to reject its own contract terms, claiming in a phone call that the rates it ended up paying for WHSV limited its ability to pay for WJLA," it says.
Besides accusing Shentel of "sham negotiations," the petition says the Edinburg-based firm didn't provide Allbritton or subscribers sufficient notice of its decision.
On Monday, Shentel filed an opposition to the petition with the FCC denying it exercised bad faith. Allbritton had already rejected Shentel's offer and put forth a counter-offer before trying to then accept Shentel's offer.
"Moreover, Shentel formally notified ACC that negotiations were terminated two days before ACC attempted to accept Shentel's prior offer," the summary of Shentel's filing says. "ACC tries to evade this glaring and fatal flaw in its attack by emphasizing that Shentel did not immediately refuse all additional ACC-initiated communication subsequent to providing its December 20th Termination Notification. But ACC, having already failed in good faith negotiations, cannot unilaterally foist upon Shentel a new obligation to engage in a second round of negotiations."
Allbritton's seeking forfeiture penalties is "vengeful," the filing says. It says Shentel will refund customers' basic service charge from Jan. 1 if they cancel their service in January and say they are doing so because WJLA was dropped.
The opposition filing says Allbritton mishandled the negotiations. It says that counter-offers made by Allbritton terminated Shentel's Nov. 10 offer.
"It is well established that a counter-offer that does not mirror the offer itself constitutes a rejection of the original offer, and the party making the counter-offer gives up any right to accept the original offer thereafter," the filing says. "Notwithstanding ACC's hyperbolic criticisms of Shentel, the reality is that ACC erred in greedily overplaying its negotiating hand."
Shentel's Nov. 10 offer for WJLA was 25 percent higher than an offer it made a week earlier, and 500 percent higher than what it had been paying for the station, its filing says. Allbritton wanted to compare the proposed fee to what Shentel would pay for WSET in Lynchburg, but that area didn't have another ABC affiliate in the mix.
Shentel points to articles and advertisements in The Northern Virginia Daily in the weeks before it stopped retransmitting WJLA as providing notice to subscribers. The filing says Allbritton could have extended its agreement for a short time if it felt customers weren't given enough notice.
Shentel has an ally in the American Cable Association. In a news release issued Tuesday, its president and CEO, Matthew M. Polka, came down on the side of Shentel.
"It's quite apparent that Allbritton has hurled frivolous allegations at Shentel, which bravely decided to resist this broadcaster's effort to extract huge amounts of money for carriage of its ABC signal," he says in a statement.
The statement accuses Allbritton of trying to "gouge" Shenandoah County cable subscribers and of having "internal mismanagement."
The association believes Congress and the FCC should create a new retransmission consent laws.