Antitrust Law Daily Wrap Up, TOP STORY: Gray Television to divest television stations as condition of Schurz Communication acquisition, (Dec 22, 2015)

By Linda O’Brien, J.D., LL.M.

The Department of Justice Antitrust Division filed a civil antitrust lawsuit today in the federal district court in Washington, D.C., challenging Gray Television, Inc.’s proposed acquisition of Schurz Communication, Inc., and simultaneously filed a proposed settlement that would resolve the competitive harm alleged in the lawsuit.

Gray is incorporated in the State of Georgia, with its headquarters in Atlanta. Schurz is a privately owned company, with its headquarters in Mishawaka, Indiana. Both Gray and Schurz operate broadcast television stations in various metropolitan areas throughout the United States.

In its complaint, the DOJ alleged that the proposed transaction would have eliminated head-to-head competition between Gray’s and Schurz’s television stations for the business of local and national advertisers on television stations in South Bend, Indiana, and Wichita, Kansas. The department determined that elimination of this competition would have resulted in higher prices and lower quality services to broadcast television spot advertisers in these markets.

The proposed settlement, which must be approved by the court, requires Gray to divest two television stations—the CBS-affiliated WSBT-TV in South Bend and the ABC-affiliated KAKE-TV in Wichita—to department-approved buyers.

“We remain vigilant in protecting competition in local television markets,” said Assistant Attorney Bill Baer of the Justice Department’s Antitrust Division. “Combining these stations under common ownership would have made it more costly for advertisers to communicate with consumers. The antitrust laws render those transactions unlawful.”

Companies: Gray Television, Inc.; Schurz Communication, Inc.

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