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Texas Judge: TWC Contract Allows Nexstar Distant-Signal Importation

Says contract had no geographic restrictions on importing TV station signals in markets where Hearst stations had gone dark 9/10/2012 11:39:54 AM Eastern

A Texas district judge last week denied Nexstar's request
for a temporary restraining order (TRO) against Time Warner Cable and signaled
Nexstar is unlikely to win its suit charging the cable operator impermissibly
imported Nexstar signals into distant markets to substitute for Hearst TV
stations that had gone dark there due to a retrans fight with TWC.

Hearst and TWC settled their dispute not long after the suit
and TRO request were filed, so the TRO was essentially moot, but Nexstar was
charging copyright infringement and the decision suggests TWC is free to import
those Nexstar signals again if it runs into a retrans impasse again in those or
other markets.

Nexstar
in July filed suit against Time Warner Cable
for copyright infringement in
a Northern Texas District Court as well as filing for the temporary restraining
order to block the transmissions. The cable operator claimed that it is doing
nothing wrong, and Judge Jorge Solis appeared to agree.

In the ruling issued Friday, Sept. 7, Judge Solis said that nowhere
does the retrans contract with Nexstar contain a geographical limitation on
TWC's retransmission consent, although it does contain a geographical
limitation when it comes to TWC's carriage obligations of those stations in
their local markets.

Given that the contract has those geographical limitations
in one part, says the Judge, Nexstar was familiar with that limitation, and its
omission in the retrans portion must be presumed to have been on purpose. Therefore,
said the court, the retransmission consent agreement (RCA) does not limit
Time Warner's abilities to retransmit the signals to any particular region.

In addition, another section of the contract permits TWC to
discontinue out-of-market transmissions, which the court notes implies that TWC
has that right, otherwise the limitation would be superfluous.

"Since the court found that it does not appear that
Time Warner breached the RCA, Nexstar has not demonstrated that it will succeed
on its copyright claims. Accordingly, Nexstar's Motion for Preliminary
Injunction is denied."

Nexstar had no comment on the judge's decision, but is expected to appeal it.

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