Bankrupt retailer Bon-Ton Stores has filed an anti-trust class-action lawsuit charging that TV station groups including Sinclair Broadcast Group and Tribune Media conspired to drive up the price of local TV advertising.
The suit, filed in federal court in the Northern District of Illinois, comes at a time when the Justice Department is also looking into local ad sales practices. Similar suits have been filed by smaller retailers around the country.
The Bon-Ton suit alleges that stations that are supposed to be competitors colluded to fix the rates TV stations charge for advertising time. They did that by sharing information and coordinating pricing within markets, resulting in artificially inflated prices for spots in violation of federal antitrust laws.
The stations set a cost-per-point price floor below which none of the colluding stations would sell a commercial to advertisers, the suit alleges.
Other stations and station groups other that Tribune and Sinclair could be added to the suit.
“Through their price-fixing scheme, Tribune, Sinclair, and their co-conspirators have monopolized the airwaves and extorted millions of dollars from businesses like Bon-Ton,” said Adam J. Levitt, co-counsel for Bon-Ton and a founding partner of DiCello Levitt & Casey. “This lawsuit aims to hold these powerful companies accountable and restore free and fair competition.”