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Cross-Ownership Muddies Tribune Sale
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But the FCC said that the waivers do not transfer to new owners, a decision that was upheld by the Supreme Court in 1978. That means Tribune's new owners would have to split up the properties in conflict or earn a fresh waiver, which Schwartzman said was "very difficult."
Tribune has similar cross-ownership problems in Los Angeles, where it owns the Times and a television station; in Hartford, where it owns the Courant newspaper and two television stations; in New York, where it owns the newspaper Newsday and a television station; and in South Florida, where it has the Sun-Sentinel newspaper and a Miami TV station.
The FCC has tried to eliminate the cross-ownership prohibition, only to be rebuked by federal courts. The current chairman, Kevin J. Martin, favors some relaxing of the rule, but sentiment at recent public meetings has run strongly against further media consolidation.
Tribune already owned television stations when it bought Times Mirror Inc. -- and its Los Angeles Times -- in 2000, banking on the FCC lifting its cross-ownership rule, which it has not done. The FCC allowed Tribune to own both the Times and KTLA until KTLA's license expired, but it must make an effort to sell either the paper or the station to comply with FCC ownership rules. KTLA's license expires on Dec. 1, and Tribune has applied for a waiver on the cross-ownership ban.
Schwartzman's group has asked the FCC to deny Tribune's request to renew its license to own KTLA under waiver, arguing that Tribune has made no effort to sell KTLA, has no interest in divesting its Los Angeles properties and is holding on to them in hopes that the FCC will lift cross-ownership restrictions.
Schwartzman's group is also planning challenges to Tribune station licenses in Connecticut and New York, which come up for renewal next year, something that a new Tribune owner would have to contend with.
Tribune stock closed down 1.1 percent yesterday at $32.26 per share. Concerns over the value of Tribune depressed the sector, with many newspaper stocks taking a mild hit.
Staff writer William Booth in Los Angeles contributed to this report.
