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Sinclair Wins. Mediacom's Motion for Injunction Denied by Federal Court

28 October 2006

The United States District Court for the Southern District of Iowa yesterday denied the motion of Mediacom Communications Corp. seeking a preliminary injunction to allow Mediacom to continue to carry television stations owned and/or programmed by Sinclair Broadcast Group, Inc. (Nasdaq: SBGI) after Mediacom's contractual right to do so terminates. As a result of the Court's decision, the retransmission consent agreement pursuant to which over eight hundred thousand subscribers of Mediacom's cable service receive twenty-two (22) television stations owned and/or programmed by Sinclair remains scheduled to terminate on November 30, 2006.


In denying Mediacom's motion, the Federal Court found in favor of Sinclair on every single factor considered as part of the injunction sought by Mediacom. Most significantly, the court concluded that Mediacom is "unlikely to succeed on the merits of its antitrust claim" against Sinclair. In reaching this conclusion the judge determined that Mediacom had not proved even one of the factors necessary to be successful in its antitrust claim.


"We are very pleased with the Federal Court's quick and overwhelmingly favorable decision in this matter," noted Barry M. Faber, Sinclair's Vice President and General Counsel. "We certainly expected the Court to reach the conclusion that it did given what we believe to be the frivolous nature of Mediacom's lawsuit. In our opinion this lawsuit represented nothing more than an ill-conceived attempt by Mediacom to influence the retransmission consent negotiations between Sinclair and Mediacom. The initiation of the lawsuit by Mediacom graphically demonstrates Mediacom's strong desire to carry our television stations, which makes it even more surprising that they won't simply agree to pay what we believe is an amount less than fair market value for the right to do so."


"It is ironic that a near monopolist, such as Mediacom, would attempt to use the antitrust laws to gain an advantage against a single broadcaster like Sinclair," commented David Smith, Sinclair's President and Chief Executive Officer. "We have negotiated in good faith with Mediacom in a manner consistent with our negotiations with other cable providers, and it is gratifying that a Federal Court has indicated that such negotiations are permissible. It is unfortunate that Mediacom has been unwilling to accept our below-market offer for the benefit of their subscribers. When Mediacom stops carrying our stations after November 30th, they will be virtually the only cable company not carrying our stations' signals."


This event only impacts Mediacom subscribers. As noted previously, alternative methods are available to receive the impacted stations' signals via free over-the-air reception or by subscribing to an alternative video service provider. In addition, Sinclair remains willing to negotiate with Mediacom regarding the right to continue to carry our stations' signals. Although Sinclair continues to regret any inconvenience caused to its viewers, Sinclair does not believe it is fair for Mediacom to refuse to pay for programming which it uses to attract and retain fee-paying subscribers.


The stations and markets impacted are:


Des Moines/Ames (KDSM-FOX), Cedar Rapids (KGAN-CBS), Mobile-Pensacola (WEAR-ABC/WFGX-MNT), Peoria/Bloomington (WYZZ-FOX), Greenville/Spartanburg/Asheville (WLOS-ABC/WMYA-MNT), Lexington (WDKY-FOX), Madison (WSMN-FOX), Nashville (WZTV-FOX/WUXP-MNT/WNAB-CW), Minneapolis (WUCW- CW), Paducah/Cape Girardeau (KBSI-FOX/WDKA-MNT), Springfield/Champaign/Decatur (WICS-ABC/WICD-ABC), St. Louis (KDNL-ABC), Tallahassee (WTWC-NBC), Birmingham (WTTO-CW/WABM-MNT), Norfolk (WTVZ-MNT) and Milwaukee (WCGV-MNT/WVTV-CW).


Sinclair Broadcast Group, Inc., one of the largest and most diversified television broadcasting companies, currently owns and operates, programs or provides sales services to 58 television stations in 36 markets. Sinclair's television group reaches approximately 22% of U.S. television households and is affiliated with all the major networks.


Forward-Looking Statements:


The matters discussed in this press release include forward-looking statements regarding, among other things, future operating results. When used in this press release, the words "outlook," "intends to," "believes," "anticipates," "expects," "achieves," and similar expressions are intended to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including and in addition to the assumptions identified above, the impact of changes in national and regional economies, successful integration of acquired television stations (including achievement of synergies and cost reductions), FCC approval of pending license transfers, successful execution of outsourcing agreements, pricing and demand fluctuations in local and national advertising, volatility in programming costs, the market acceptance of new programming and our news central strategy, our local sales initiatives, and the other risk factors set forth in the Company's most recent reports on Form 10-Q and Form 10-K, as filed with the Securities and Exchange Commission. There can be no assurances that the assumptions and other factors referred to in this release will occur. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements.

Source: prnewswire





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