Eight states filed a federal lawsuit Wednesday to block the $6.2 billion merger between Nexstar and Tegna, which would create the largest local broadcast company in the United States. California, Colorado, Connecticut, Illinois, New York, North Carolina, Oregon and Virginia argue the deal would create a "broadcast behemoth" that harms competition and raises consumer fees.
The merger represents a critical test of the Federal Communications Commission's deregulation agenda under the current administration. The deal would require the FCC to lift existing limits on television station ownership, which currently prevent any group from owning stations reaching more than 39% of U.S. households. FCC Commissioner Brendan Carr has already signaled support for the transaction.
The states argue in their lawsuit that the merger violates the Clayton Antitrust Act by further consolidating already concentrated broadcast markets. They contend that "eliminating independent news operations will diminish diversity in news coverage," which they say is "critical to the ability of an informed citizenry to participate in local governmental and community activities." The lawsuit warns the merger would make it even harder for competitors to enter highly consolidated markets.
California Attorney General Rob Bonta stated that "when broadcast media is owned by a handful of companies, we get fewer voices, less competition, and communities lose the critical check on power that local journalism delivers." The outcome hinges on whether the FCC can modify ownership rules without congressional approval, a position supported by Commissioner Carr and the National Association of Broadcasters trade group.