Lawsuit demands cable channel choices
EmptyThe U.S. pay-TV industry amounts to a "cartel" that maintains profits by offering channels in prepackaged tiers rather than "a la carte," according to a class-action antitrust lawsuit filed Thursday.
The suit, filed in U.S. District Court in Los Angeles, names every major cable and satellite television system operator as well as every major cable and broadcast television network.
Antitrust lawyer Maxwell M. Blecher alleges in the legal action that the complex web of contractual arrangements among service providers and networks amounts to a "monopoly or cartel" that has "deprived consumers of choice, caused them to pay inflated prices for cable television and forced them to pay for cable channels they do not want and do not watch."
"The antitrust laws protect the right of choice," Blecher said. "Here the customer is denied that choice."
Rob Stoddard, a spokesman for the National Cable and Telecommunications Association, a trade group for the U.S. cable television industry, said he couldn't comment on the suit because he had yet to view the complaint.
Blecher contends cable and satellite television subscribers should be able to choose only to pay for the channels they actually want to watch.
Federal Communications Commission Chairman Kevin Martin has said such a system would require federal legislation.
In the past, the cable TV industry has argued that an a la carte system would lead to higher prices, less programming diversity, fewer channels and reduced advertising dollars.
Such a system also would require more customer service representatives, higher billing costs and higher marketing costs, the industry has said.
Blecher's lawsuit alleges violation of federal antitrust laws and conspiracy to monopolize.
It seeks unspecified damages and an injunction that would force cable operators to notify subscribers that they can purchase channels on an individual basis.
The complaint names nine plaintiffs in several states who are identified as subscribers of several of the cable or satellite television companies named in the lawsuit.
Blecher estimated as many as 80 million people receive bundled cable or satellite television packages and could be a party to the case should it receive class-action status.
The companies named in the suit are NBC Universal Inc., Viacom Inc., The Walt Disney Co., Fox Entertainment Group Inc., Time Warner Inc., Comcast Cable Communications Inc., Cox Communications Inc., The DirecTV Group Inc., Echostar Satellite LLC, Charter Communications Inc. and Cablevision Systems Corp.