FCC sides with Shentel in contract allegations

By Sally Voth - svoth@nvdaily.com

The Federal Communications Commission has sided with Shentel Telecommunications Company in a dispute with the operators of WJLA (ABC 7).

The Edinburg-based telephone and cable company dropped the Washington, D.C., station at the start of 2012 following failed negotiations over retransmission fees with the operators of WJLA, Allbritton Communications Company.

In response, Allbritton filed a complaint with the FCC, accusing Shentel of bad-faith negotiations, saying the company had rejected its own contract terms, and of failing to provide Allbritton or cable customers sufficient notice of the change to the lineup.

Shentel hit back, saying it had notified Allbritton it was cutting off negotiations two days before Allbritton accepted a prior offer from Shentel, and Allbritton had also rejected Shentel's offer and had come up with a counter before later accepting the earlier offer.

FCC Media Bureau Chief William T. Lake issued a memorandum opinion and order Friday.

It states both parties weren't able to agree on a contract because of disagreements over the cost, which Allbritton acknowledged.

"...Absent other factors, disagreement over the rates, terms and conditions of retransmission consent -- even fundamental disagreement -- is not indicative of a lack of good faith," the memo states.

It adds, "Although Allbritton may regret that it did not accept Shentel's November 10 offer when it was available, that does not mean that Shentel failed to negotiate retransmission consent in good faith."

"Black letter contract law" provides for the "offeree" losing the power of acceptance once they make a counter-offer, the memo states.

"Moreover as a policy matter, it would make little sense to require every offer made...to run in perpetuity," it states.

The memo points out Shentel cable subscribers still have access to ABC affiliate WHSV out of Harrisonburg.

Allbritton had also accused Shentel of not giving it and customers at least 30 days' written notice that it was deleting the WJLA signal.

The memo states Shentel said this alleged violation wasn't related to the bad-faith allegations, had offered to refund charges to subscribers who canceled their service in January because WJLA was dropped, and that a Dec. 8 Daily article said the channel might be dropped and Shentel had run ads in the paper beforehand.

While the FCC agrees the issues are separate, "we caution Shentel that the Commission" does have a 30-day notice requirement and can enforce that rule, according to the memo.

Shentel Chief Operating Officer Earle MacKenzie said Monday afternoon he was pleased the FCC found the company had negotiated in good faith.

"It was very important to us from our reputation standpoint for this to come out, so we're incredibly pleased both that we've been vindicated, and also with the outcome," he said. "We appreciate our customers' support."