Viacom Asks Federal Court to Toss $1 Billion Cablevision Suit

Similar case involving both parties was thrown out last year

Viacom is calling for a federal court to toss out Cablevision's $1 billion lawsuit alleging that the company's policy of bundling unpopular channels violates antitrust law, according to The Hollywood Reporter.

The lawsuit claims that Viacom threatened to impose a 10-figure penalty if Cablevision did not license little-watched channels like Palladia, MTV Hits and VH1 Classic along with its major networks MTV, Nickelodeon and Comedy Central. Cablevision contends that this policy sapped bandwidth it could have used for other channels, but Viacom rejects he characterization of its bundling policy as illegal and contends that Cablevision is bound by its contract.

The media company has gone on the attack, accusing Cablevision of contradicting itself and arguing that the TV provider has failed to demonstrate grievances. “This suit is a transparent ploy by Cablevision to renegotiate its agreement with Viacom,” a Viacom spokesperson said. “Its decisions to raise prices for consumers and reject carriage for smaller networks have nothing to do with its Viacom contract. Our suite offering provides consumers greater choice at lower cost.”

Cablevision returned serve, arguing that Viacom’s assertions “are predictable and do not change the fact that its all-or-nothing approach to selling programming is illegal and anti-consumer.” A spokesperson went on to accuse Viacom of dealing from the bottom of the deck: “By forcing Cablevision’s customers to pay for more than a dozen unpopular channels—or pay a penalty of more than $1 billion—in order to receive the channels they actually want, Viacom is abusing its market power. Viacom is using our customers as pawns in its game to limit choice and competition and, ultimately, it is the consumer who suffers the consequences of Viacom’s illegal actions.”

Viacom and Cablevision were co-defendants—along with Time Warner, Comcast, DirecTV, Walt Disney, and News Corp.’s Fox Entertainment Group—in a similar case that was thrown out by a federal court of appeals in March 2012.