As we noted several weeks ago, Deputy Senate Majority Leader Mike Gianaris revised his antitrust legislation (S.933C) and pushed the bill through the New York State Senate. NYSBA, the New York State Business Council, MPAA, and others were able to block the bill in the Assembly.
While the bill allegedly focused on “Big Tech,” it would have disrupted antitrust laws in New York for all businesses, including broadcasters. The legislation adopted a European model for antitrust enforcement. Antitrust cases would no longer be based on controlling the market. Instead, antitrust liability would apply where there has been an “abuse of a dominant position.” The New York Attorney General was tasked with defining the scope of this term.
Under the bill, exclusive programming contracts in radio and television could be called into question because “exclusivity” may be an “abuse.” In addition, using a post-term covenant not to compete is considered to be evidence of “abuse of a dominant position.” While broadcasters are precluded from using such covenants for employees, they are allowed in management contracts under existing law. Moreover, ownership combinations that the FCC has approved could run afoul because of the proposed new antitrust law. Violations of state antitrust laws can affect a station’s license renewal.
So, we are safe for this year. Unfortunately, it will be back next year. To see a copy of our Memo in Opposition click HERE.
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