Time Warner Cable Sued for Allegedly Stealing CBS, NBC Signals

There's been a lot of attention of late on the way that contracts are brokered between networks and pay-TV distributors. It's time for even more discord on the retransmission front as Nexstar Broadcasting, one of the nation's largest operators of network affiliate stations, has just launched a big court battle against Time Warner Cable.

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On July 9, Time Warner Cable lost out on several NBC and CBS stations in certain local markets because of contract impasses with Hearst Television and Bright House Networks. So TWC grabbed Nexstar's own NBC and CBS stations in other local markets, distantly retransmitting them as "replacement stations."

On Monday, Nexstar filed a lawsuit, alleging this to be a breach of contract as well as a violation of its copyrights. TWC disputes that and says it was the only way to guarantee that some of its customers could continue seeing the Olympics and other programming.

According to the complaint, TWC has been taking NBC signals in Indiana and Pennsylvania and a CBS signal in Rochester, New York -- all owned by Nextar -- and retransmitting them to markets including Cincinnati, Louisville, Orlando, Winston-Salem and Burlington-Plattsburgh -- places where TWC's agreement with Hearst and Bright House have expired.

Nexstar says this violates a 2009 retransmission consent agreement that purportedly specifies the geographic areas in which TWC can retransmit programming. As a result of what's happened, Nexstar alleges its goodwill with national advertisers has been harmed and that viewers are being confused.

As one example, Nexstar says that those who watch CBS in Louisville don't want to learn about the weather in Rochester. "Confused viewers have contacted Nexstar stations wondering why their local stations have been replaced with those from distant cities," says the complaint.

TWC is also allegedly doing things like transmitting "the exact same syndicated programming" from two different stations into the Winston-Salem market. The situation has caused confusion, programming blackouts, and what Nexstar alleges are violations  of FCC rules that permit TV stations to enforce their rights to be the exclusive distributor of network and syndicated programming in their local markets.

What TWC is doing has not only upset Nextar, but also NBC, which demanded last week that TWC cease its distant retransmission practice.

Nexstar says it worries that its valued relationship with its network suppliers is being harmed. "The damage to Nextar's relationship with the networks is hindering its current negotiations with NBC and CBS for new network affiliation agreements," says the complaint, which is seeking a temporary restraining order, a permanent injunction, and monetary damages.

In response, TWC says in a statement to The Hollywood Reporter that it is within its contractual right to distantly retransmit the signals:

"Time Warner Cable’s retransmission of Nexstar’s signals is fully authorized by the retransmission consent agreement between the parties and allows us to seamlessly continue carriage of the network programming that Hearst Broadcasting pulled from our systems in an attempt to force consumers to pay more for it. This carriage assures our customers of continued access to the upcoming Olympics coverage and other important programming. We are disappointed that Nexstar is working to assist and expand Hearst’s leverage against us and our customers by bringing this suit. We are confident that we are operating within our rights and the law and will continue to fight for our customers against this aggressive and coercive broadcaster behavior."

E-mail: eriq.gardner@thr.com; Twitter: @eriqgardner