Sinclair Abandons Shell Company in Television-Ownership Ruse

WASHINGTON -- On Thursday, Sinclair Broadcast Group told the Federal Communications Commission it would abandon its plans to illegally control multiple stations in the Charleston, S.C., and Birmingham, Ala., markets. The abandoned transactions were part of a $985 million deal with Allbritton Communications involving Sinclair's acquisition of nine television stations and NewsChannel 8. 

Free Press petitioned to deny these specific license transfers, which were structured using "covert consolidation" tactics — abusing FCC ownership limits by hiding stations behind a shell company controlled by Sinclair.

Free Press Policy Counsel Lauren Wilson made the following statement:

"We commend the FCC for closing loopholes in its ownership policies, clearly signaling to Sinclair that the agency would no longer tolerate its dodging of the rules. Apparently, the message was received, and that's good news.

"In a statement on Thursday, FCC Commissioners Pai and O'Reilly tried to paint these events as a blow to ownership diversity. However, the Sinclair shell company — Armstrong Williams' Howard Stirk Holdings — was slated to become a licensee in name only, and not a truly independent owner. Sinclair's overarching goal as always was to prevent competition and increase its stranglehold on media markets across the country, not to find actual buyers for and users of these public airwaves in the affected communities.

"HSH itself was never a viable buyer, but a shell corporation through which Sinclair could expand its influence over local broadcasting. Sinclair's change of heart signals nothing more than its eagerness to close its deal with Allbritton. It also shows that Sinclair can make the same programming available by using digital multicasting technology to air more than one network on its existing stations without the shell company ruse."