Equity Broadcasting Prevails in Arbitration Against Paxson Communications
27 August 2004 - 2:30PM
PR Newswire (US)
Equity Broadcasting Prevails in Arbitration Against Paxson
Communications Broadcaster Will Terminate All PaxTV Network
Programming in St. Louis, Montgomery & Panama City This Sunday
LITTLE ROCK, Ark., Aug. 27 /PRNewswire-FirstCall/ -- Equity
Broadcasting Corporation, the nation's ninth largest television
broadcast station group, announced today that a three member
arbitration panel ruled in its favor in an ongoing arbitration
proceeding with Paxson Communications Corporation (AMEX:PAX). The
Panel ruled that Paxson breached "most favored nations" provisions
in Equity/PaxTV network affiliation agreements by failing to offer
amendments that would have shortened the ten year agreements to two
years, and the Panel exempted Equity from broadcasting PaxTV
infomercial and religious programming since 2001. The Panel further
ruled it would hold a hearing later this year to determine Equity's
damages resulting from PaxTV's breach. Equity also announced that
as of midnight August 29, it will cease broadcasting PaxTV
programming on the three stations directly affected by the Ruling
-- WPXS in St. Louis (DMA # 21); WBMM in Montgomery, Alabama (DMA #
115); and WBIF in Panama City, Florida (DMA #158). Equity has also
notified Paxson that it will cease broadcasting PaxTV on KWBS in
Springfield, Missouri (DMA #78) and Fort Smith-Fayetteville,
Arkansas (DMA #107), a station that was not involved in the
arbitration directly, but which is subject to termination on the
same basis as are the other three stations. PaxTV, the so-called
"seventh network", was launched in 1998 with a promise to provide
twenty four hours a day of quality family-oriented programming free
of excessive violence, explicit sexual themes and foul language.
Unable to garner viable ratings for its schedule of low budget
original programming and late-cycle syndicated programming, in
January 2003, PaxTV increased its infomercial and paid programming
to more than half of its broadcast day. "The Panel's ruling means
that we can terminate PaxTV in these markets, and focus on
rebuilding these stations to better serve our viewers." Said Larry
Morton, Equity's Chairman and CEO. "These stations represent more
than 2% of US television households. Not being locked into long
term PAX affiliations should significantly improve Equity's
position in these markets." "Last week, Paxson's Chairman
criticized NBC for failing to abide by the 'plain meaning' of
'clear and unambiguous terms' of an agreement," said Jeff Sanders
of Seyfarth Shaw in New York, Equity's counsel in the arbitration.
"It is somehow fitting that the Panel's ruling here is based on the
conclusion that Paxson failed to honor the unambiguous language of
its own affiliation agreements." About Equity Broadcasting
Corporation Equity Broadcasting Corporation has become one of the
fastest growing broadcast companies in the United States. Since
1997, the company has dramatically increased its broadcast holdings
and vaulted into the enviable position of being one of the 10
largest broadcast companies in the country. For more information on
Equity Broadcasting Corporation, please visit the company's Web
site at http://www.ebcorp.net/ . DATASOURCE: Equity Broadcasting
Corporation CONTACT: Jeff Sanders of Seyfarth Shaw,
+1-212-218-5280, Web site: http://www.ebcorp.net/
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