Marshall Broadcasting: Mediator appointed to resolve Nexstar dispute

By Caroline Salls

Pittsburgh, Jan. 28 – Marshall Broadcasting Group, Inc.’s motion for appointment of a mediator to resolve disputes with Nexstar Broadcasting was approved on Monday by the U.S. Bankruptcy Court for the Southern District of Texas.

As previously reported, last year, Marshall Broadcasting Group called on federal regulators to investigate broadcast giant Nexstar Broadcasting for what it called a “calculated conspiracy” to dupe government officials, sabotage Marshall’s operations and circumvent federal guidelines governing the business relationship between the two companies.

In a complaint filed with the Federal Communications Commission on June 12, 2019, Marshall officials said that these actions warrant a federal investigation into Nexstar’s continued qualifications to be a licensee of televisions stations in the United States.

Marshall said Nexstar orchestrated the sale of three television stations in 2014 and 2015 after being forced to spin off the stations as part of a separate larger acquisition that put Nexstar over the FCC’s ownership caps.

While the FCC was led to believe that the sale would further its objective of increasing ethnic diversity in broadcast ownership, Marshall alleged that Nexstar was actually undermining its operations to decrease its worth.

The FCC complaint came on the heels of a lawsuit filed by Marshall in April with the Supreme Court of the State of New York and details several violations of the commitments Nexstar made to the FCC in an effort to obtain approval to purchase the larger cluster of television stations.

Marshall alleged in the June statement that Nexstar consistently interfered in its sales and operations in defiance of FCC directives, overcharged Marshall for the same stations and assets that it intended to sell to another potential buyer by more than an additional $16 million and tried to cause Marshall to default on its bank line of credit by withdrawing its guaranty despite Nexstar’s commitment to the FCC to guarantee the debt for five years.

Judge Christopher M. Lopez was appointed as mediator.

Marshall is a Houston-based broadcasting company. The company filed bankruptcy on Dec. 3 under Chapter 11 case number 19-36743.

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