Court bars challenge to bundled cable channels

By Dan Levine

(Reuters) - Television programmers and distributors do not have to face a lawsuit that sought to compel them to sell cable channels separately to consumers, instead of in multi-channel packages, a U.S. appeals court ruled.
The U.S. 9th Circuit Court of Appeals on Friday found that the plaintiffs - cable and satellite TV subscribers - failed to state an antitrust claim against Walt Disney, Fox Entertainment Group Inc, Comcast Corp and several other companies. The plaintiffs intended to seek class-action status.
Maxwell Blecher, an attorney for the plaintiffs, said he was very disappointed in the decision and that his clients will likely seek review before a larger 9th Circuit panel.
"It is so wrong," Blecher said of the ruling.
Glenn Pomerantz, an attorney for Fox, said the company was "extremely pleased" with the ruling.
"The agreements between television programmers and cable and satellite operators do not injure competition in any way," Pomerantz said. "They are totally legal and justifiable."
Representatives for Disney and Comcast could not immediately be reached.
The lawsuit, filed in a California federal court, alleged that television programmers exploit their market power by requiring distributors to sell less desirable cable channels, along with select "must have" channels. Those business practices impair competition among distributors for consumer business, the plaintiffs alleged.
The lower court dismissed the lawsuit, and on Friday, a three-judge 9th Circuit panel unanimously affirmed.
"The complaint does not allege that programmers' practice of selling 'must-have' and low-demand channels in packages excludes other sellers of low-demand channels from the market," the court wrote, "or that this practice raises barriers to entry into the programming market."
The case in the 9th Circuit is Rob Brantley et al, individually and on behalf of all others similarly situated v. NBC Universal Inc., Viacom Inc., The Walt Disney Company, Fox Entertainment Group Inc., Time Warner Inc., Time Warner Cable Inc., Comcast Corporation, Comcast Cable Communications LLC, CoxCom Inc., The DirecTV Group Inc., Echostar Satellite LLC, Cablevision Systems Corporation, 09-56785.
(Reporting by Dan Levine; Editing by Steve Orlofsky, Gary Hill)