PUSH pushing FCC over Sinclair/Glencairn

Abstract

The Rainbow/PUSH Coalition is raising questions at the FCC about whether Sinclair Broadcasting is exercising control over a minority-headed TV group with which it has struck a series of local marketing agreements (LMA). In a July 1, 1998 filing at the FCC, Rainbow/PUSH said it plans to study whether the LMA deal between Sinclair's KABB(TV) San Antonio and Glencairn's KRRT(TV) Kerrville, Texas violates the commission's prohibition against common ownership of 2 local stations.

Headnote

Tells commission it is studying LMA relationship in Texas

The Rainbow/PUSH Coalition is raising questions at the FCC about whether Sinclair Broadcasting is exercising control over a minority-headed TV group with which it has struck a series of local marketing agreements (LMAs).

In a July 1 filing at the FCC, Rainbow/PUSH said it plans to study whether the LMA deal between Sinclair's KABB(TV) San Antonio and Glencairn's KRRT(TV) Kerrville, Tex., violates the commission's prohibition against common ownership of two local stations.

"Rainbow/PUSH has not had an opportunity to fully research this matter, and thus preserves here the question of whether Glencairn is the alter ego of Sinclair," the group told the FCC. "As Rainbow/PUSH examines this matter, it intends to focus on whether [KRRT] has any meaningful corporate personality of its own."

Rainbow/PUSH attorney David Honig says he hopes to wrap up the follow-up investigation within weeks. "We'll be fair," he adds.

Honig's group launched its review of Glencairn's ownership after charging that both the Glencairn and Sinclair stations in Texas had violated the FCC's equal employment opportunity rules. A Washington court in April found those rules largely unconstitutional, but they remain in effect while the FCC pursues an appeal of the ruling.

Sinclair Government Relations Director Mark Hyman labeled as baseless any charge that Sinclair is controlling Glencairn. He also says he's confident that the stations' EEO performance will hold up to any FCC review. Hyman says that anyone suggesting Sinclair is running the Glencairn stations has not visited those stations.

Sinclair holds 13 LMA deals with Glencairn. The Baltimore-based Sinclair often has insisted that its deals with Glencairn help to promote minority participation in broadcasting. Glencairn's voting stock is 100% held by company president Eddie Edwards, who is black.

But others, such as Pulitzer Broadcasting and Post-Newsweek Stations, have claimed that the LMAs give Sinclair an unfair advantage in the markets, pointing to the ownership of Glencairn's equity.

According to documents filed at the Securities and Exchange Commission, 90% of Glencairn's equity is held in nonvoting stock in trusts established by Carolyn Smith, mother of Sinclair President David Smith. Carolyn Smith holds another 7% of the equity herself, while Edwards holds the remaining 3%.

Sinclair also holds an option to purchase Carolyn Smith's interest in Glencairn, although Sinclair's lawyers in past FCC filings have asserted that doing so would still give the company no say in Glencairn's operation.