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DirecTV Files Complaint With FCC Against Tribune In Retrans Fight

Tribune says they never had a 'handshake deal' with DirecTV
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The retransmission consent battle between DirecTV and Tribune escalated Monday with accusations, counter-accusations and the inevitable filing with the Federal Communications Commission by DirecTV.

As of midnight March 31, 23 Tribune stations in 19 cities and cable network WGN America went dark on DirecTV because the two parties could not reach a carriage deal. More than 5 million DirecTV customers were affected in some of the nation's largest markets such as New York, Los Angeles and Chicago.

Aside from the usual fight over how much money DirecTV might be willing to pay Tribune for carrying its stations and WGN America, the companies are also exchanging barbs over whether or not there was a "handshake deal" two days before the expiration of the current carriage contract.

DirecTV said in a statement it had a "handshake deal" that it agreed to, but Tribune said it didn't. Stations were pulled, so now DirecTV is turning to the FCC, even though the FCC has historically stayed out of retransmission standoffs because of limited authority.

In its complaint to the FCC, DirecTV alleges that Tribune did not negotiate "in good faith," blaming "Wall Street greed." (Tribune is still trying to crawl out of bankruptcy.)

"Two days prior to expiration of the existing carriage arrangement, the parties reached an agreement in principle for continued carriage. The following day, however, Tribune reneged on that agreement. Tribune later confirmed that its management had been overruled by the hedge fund and investment bank creditors that hold the company’s debt, including Oaktree Partners, Angelo Gordon, JP Morgan Chase, Bank of America, and Citibank," wrote Derek Chang, DirecTV's executive vp of content strategy and development, in the FCC complaint.

DirecTV also wrote in its complaint it doesn't know who with whom at Tribune it should be negotiating: Tribune's creditors or Tribune's CEO, Eddy Hartenstein, who just happens be the former president of DirecTV.

In a statement responding to DirecTV's latest move, Tribune chalked up DirecTV's claims of "bad faith" and "outrageous conduct" as "nothing more than negotiating tactics in an attempt to unfairly disadvantage Tribune from receiving fair market compensation from DirecTV."

Tribune also said that it had not prematurely transferred its broadcast licenses to its creditors.

As for DirecTV's claim about a deal, Tribune said it never had one. "Over the course of any negotiation, parties may agree in principle on some terms and disagree on others, but it takes closure on all terms by both parties to reach an agreement. We never reached agreement with Direct on all the terms of the contract, not in principle, not by handshake and not on paper. We didn't have an agreement on Thursday, March 29, and we do not have an agreement now," the company said in a statement. 

Previously, Tribune has said that it is asking for less than a penny a day per subscriber.