Time Warner Cable and Charter Communications recently informed a New York judge that Fox News is trying to extract “tens of millions of dollars of subscription fees to which it is not entitled as a matter of contract, industry practice, or common sense.”
Both the parties approached the court to figure out which of the cable company’s agreement actually governs the carriage of Fox News by Spectrum. Spectrum is the latest joint venture between both TWC and Charter and it happened after Charter acquired TWC a few months ago.
Reports indicate that Charter Communications was paying more per subscriber fee to FOX News than TWC, and they wanted the network under the TWC deal for Spectrum. On the other hand, Fox News stated that Charter could not claim that TWC is the surviving party to the agreements, because they have already informed the shareholders and regulators that the company is acquiring TWC.
The complaint from Fox News noted that, “Charter’s position that TWC acquired and now manages Charter is a ruse, acting as a fraud on Plaintiff and on the public generally a point no more clearly seen than that. Since its acquisition of TWC, Charter has reportedly decided to vacate the Time Warner Center and move all operations to Charter’s offices in Connecticut.”
Fox News also wanted the judge to announce that the existing Charter agreements are the operating ones and not the TWC deals, which were terminated by the network.
A court brief stated, “Plaintiff maintains that the deal that should set the terms for the combined New Charter is the higher-rate deal that applied to a smaller operator, with fewer customers, rather than the lower-rate deal that applied to a bigger operator, with more customers. This is nonsensical and contrary to the fundamental economic logic of the cable industry.”
Reports from several reliable sources indicate that Charter Communications is also planning to argue against the idea of fraud during the negotiation agreement with Fox News. Charter said that the fraud claim “is nothing more than a claim that New Charter never intended to follow its contracts.” Charter also told the judge that the statements they made about future intent could not be considered actionable under the New York law.