Court sides with Centro Europa 7

Cleared for takeover of Rete 4 frequencies

ROME -- In Mediaset's second setback involving its Rete 4 channel in just over a week, Italy's highest administrative court on Wednesday ruled that defunct broadcaster Centro Europa 7 has the rights to the frequencies currently being used by Rete 4.

The decision from the National Administrative Court does not mean Rete 4 will have to abandon its frequencies immediately, but the ruling will make it much harder for Mediaset to argue that Rete 4 has the right to hold on to those frequencies until all national networks are required to migrate to digital frequencies in 2012.

A week ago, the Italian parliament narrowly disallowed a decree that would have guaranteed Rete 4 rights to those frequencies for the next four years.

The case involving Centro Europa 7 dates back 11 years, when Rete 4 exploited a loophole in an edict from the Communications Authority to deny the would-be broadcaster access to the frequencies, putting the company out of business before it ever took the air.

Wednesday's ruling bolsters the case for Centro Europa 7 shareholders who could sue Rete 4 or the Communications Authority for damages or petition to be given the frequencies they need to resurrect the company.