Altitude TV's fight with distributors that have dropped the broadcasting home of the Denver Nuggets and Colorado Avalanche amid a long-running disagreement over fees seemed headed toward a resolution after the network cut a deal with DIRECTV a few weeks back. But neither Comcast nor DISH have blinked since then, prompting Altitude TV to take the scrap to the next level. The firm, part of the Kroenke Sports & Entertainment empire that also owns the Nuggets and Avs, has filed a class-action lawsuit in U.S. District Court accusing Comcast of using its monopoly power to drive Altitude out of business.
The complaint maintains that "Comcast now wants to extinguish competition from Altitude so that Comcast can pocket more of the money it takes from consumers each month for sports programming in the Denver DMA [Designated Market Area]."
Comcast's response to this action reads: "This is a meritless lawsuit in an intensely competitive market where Comcast has no competitive regional sports network and Altitude has multiple distribution alternatives. Instead of pursuing baseless litigation, Altitude should engage in responsible commercial negotiations that would allow Comcast to distribute its programming to those customers who want it without driving up costs for customers who do not. Since at this point Altitude has rejected all reasonable offers, we have provided our customers with a credit until we reach an agreement. We will vigorously defend ourselves against Altitude’s claims."
Altitude Sports president Matt Hutchings and William Isaacson, an attorney for the law firm of Boies Schiller Flexner LLP, have a very different view, as they made plain during a November 18 teleconference after the suit was filed. According to Hutchings, Comcast's yanking of the channel has resulted in Altitude TV being inaccessible to more than 50 percent of its usual audience, "unjustifiably and unreasonably resulting in us reaching fewer families and fans in the region," since the only way they can tune in on the regular is to "pay for a more expensive cable package."
Hutchings went on, "Comcast refuses to pay us anything close to fair market fees or to insure that Nuggets and Avalanche fans are able to watch without significant price increases." Unlike DIRECTV, he contended, "Comcast refuses to negotiate market-based fair terms — similar terms to what they gave us for the past fifteen years or the same terms it gives regional sports networks it owns itself. Our costs would be higher than our revenues, and Comcast knows this. Accordingly, Comcast has left us no option [but] to hold them accountable in federal court."
As for the legal contentions put forward in the suit, Isaacson said, "As you know, federal and Colorado anti-trust laws prohibit monopolies from abusing power...and Comcast has monopoly power in several ways. A significant one is that as a buyer of regional sport programming in the Denver region for the past fifteen years, there's been a good relationship between Comcast and Altitude. It's been profitable. But now it's proposing terms that are unjustifiable because they're un-economic."
He added that by blacking out Altitude, Comcast has "hurt families across the region. But at the same time, Comcast is continuing to charge a regional sports fee of $6.75." Isaacson acknowledged that Comcast lowered the cost from $8 after removing Altitude TV, but noted, "The fee started in 2015 at a dollar. That's an over 500 percent increase during a time when we didn't have a new contract with Comcast. There was no big increase in rates, no increase in cost for Comcast that necessitated moving it up to $8. That's how you know Comcast is powerful. It's able to say to its customers, 'Now you're going to pay $8.'"
Isaacson emphasized that Colorado Attorney General Phil Weiser sent letters to Comcast (as well as DISH and DIRECTV) questioning whether customers had been overcharged after Altitude TV was taken down in late August. And on November 15, Governor Jared Polis tweeted an open letter to Altitude Sports President and CEO Jim Martin in which he wrote, "In Colorado, we love our professional sports teams, including the Nuggets, Avalanche, Rapids and Mammoth. Most of us miss seeing them on our home TVs. As Governor, I strongly encourage you to complete a deal immediately that allows us to watch our Colorado teams at home on DISH and Comcast. This has simply gone on for too long."
Hutchings said the governor's office had not been consulted about the lawsuit and denied that "this is any part of a political strategy. I think the complaint speaks for itself." However, he continued, "I think it's important that the governor is obviously aware of this situation that impacts all of the folks in Colorado, as well as the rest of the region we serve. ... I think it's good that the governor is aware of this and has put in his opinion. I think that's a positive for the people of Colorado."
When asked why DISH wasn't named in the suit, Isaacson merely replied, "We're not addressing DISH today." Clearly, however, the monopoly argument is much easier to make against Comcast, the dominant cable-TV provider, than DISH, which shares the local satellite-TV market with DIRECTV.
Of course, federal lawsuits frequently take years to wind their way through the system — and that implies that Altitude TV's complaint is mainly about ratcheting up the pressure on Comcast to compromise. While Isaacson conceded that "history tells you all sorts of cases settle," he insisted that "we're prepared to do this the whole way." But he also said, "Any court will tell both parties to try to reach a rational resolution."
You can bet Nuggets and Avs fans are rooting for one. Click to read Altitude Sports & Entertainment v. Comcast Corporation.
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