Rodgers, Cruz Criticize FCC on Standard/Tegna HDO, Claim Precedent Violations

House Commerce Committee Chair Cathy McMorris Rodgers, R-Wash., and Senate Commerce Committee ranking member Ted Cruz, R-Texas, want the FCC to explain the Media Bureau’s February hearing designation order on the $8.6 billion proposed Standard General/Tegna deal, seen as a de facto denial of the transaction (see 2302240068). Standard, Tegna and NAB are challenging the HDO in the U.S. Court of Appeals for the D.C. Circuit (see 2303310055). Cruz and Rodgers want the FCC to provide information by April 19 on the commission’s handling of the deal, including why the Media Bureau issued the HDO on its own instead of seeking a vote from Rosenworcel and the other three commissioners.

“In the past 30 years, no broadcast license transfer has gone through the hearing process in less than 358 days (the average time is 799 days),” Cruz and Rodgers said in a letter to FCC Chairwoman Jessica Rosenworcel. The deal’s May 22 expiration date means “the Media Bureau’s action effectively kills the transaction.” The HDO “violates Commission rules and precedents,” including that a full FCC vote “is required for certain matters, particularly those involving novel issues and/or significant legal or policy consequences,” the GOP leaders said.

“Designating a multi-billion-dollar transaction” like Standard/Tegna “for an ALJ hearing is precisely the type of serious decision for which commissioners must take responsibility,” Cruz and Rodgers said. “The last time the FCC referred a major transaction to an ALJ, the decision was made at the Commission level, and the FCC should not have departed from that precedent.” The HDO “relied on novel interpretations of the Commission’s public interest standard and appeared to ignore -- if not contradict -- the Commission’s precedent that ‘an increase in retransmission consent rates, by itself’ does not constitute a public interest harm,” the GOP leaders said: The Media Bureau also “did not” follow FCC precedent that called for giving “the full Commission 48 hours’ notice” before it issued the order.

Cruz and Rodgers noted “the decision has raised questions” about whether “outside interests pushed Commission officials to block” the Standard deal “in order to pave the way for an alternative buyer, namely” Allen Media CEO Byron Allen, whose company unsuccessfully sought to buy Tegna in 2021. Allen “is a major Democratic donor,” including a $250,000 donation to the House Majority PAC and $100,000 to the Senate Majority PAC after Standard and Tegna announced their deal last year, the GOP lawmakers said: “Regardless, these accusations are concerning because even the appearance of impropriety harms the Commission’s reputation as a fair arbiter.”

The FCC declined comment. Allen didn’t immediately comment.