Newsmax sues Fox News for allegedly using ‘leverage’ to harm competing networks

Daily Caller News Foundation

Newsmax Broadcasting filed an antitrust lawsuit against Fox Corporation and Fox News on Wednesday for its alleged “unlawful monopolization” to prevent fair competition between right-leaning news networks.

The lawsuit alleges that Fox is blocking competition in the market for Newsmax and other right-leaning networks, specifically by allegedly imposing financial penalties on distributors if they air Newsmax. The network argued they would have seen its audience and ratings “grow sooner” and have become “a more valuable media property” if it were not for Fox’s alleged “anticompetitive behavior.”

“Newsmax would have achieved greater pay TV distribution, seen its audience and ratings grow sooner, gained earlier ‘critical mass’ for major advertisers and become, overall, a more valuable media property,” the lawsuit states. “Fox’s campaign to stunt Newsmax’s business has delayed, for almost a decade, Newsmax’s growth in pay TV distribution, especially in the critical virtual Multichannel Video Programming Distributor (‘vMVPD’) arena, and has resulted in significant damages to Newsmax, including in the form of lost business, missed advertising and marketing revenues, and lower cable license fees, all while increasing overall company costs. Newsmax is far from the only victim.”

Fox also allegedly conditions “no-carry provisions,” which restrict or block distributors from airing competitors such as Newsmax, the lawsuit alleges. If distributors place Newsmax in basic packages, Fox penalizes the distributors by making them promote its less popular channels.

A Fox News spokesperson told the Daily Caller News Foundation that Newsmax “cannot sue their way out of” their own failures.

“Newsmax cannot sue their way out of their own competitive failures in the marketplace to chase headlines simply because they can’t attract viewers,” the Fox spokesperson said.

The lawsuit further alleges that Fox has pressured its guests not to appear on Newsmax and has hired private investigators to target Newsmax executives.

One distributor named vMVPD Fubo allegedly told Newsmax in June that it would no longer include the network in its package as a result of Fox’s “leverage,” according to the lawsuit. The network has also allegedly been “delayed” from being part of Sling TV’s package.

Newsmax is seeking damages under Sections 1 and 2 of the Sherman Act, the Florida Antitrust Act, and the Florida Deceptive & Unfair Trade Practices Act. The network is asking a federal court to declare Fox’s actions as unlawful and to pay monetary damages as permitted by law. They are further seeking a jury trial.

“Fox’s behavior represents a textbook abuse of monopoly power,” Newsmax’s lead counsel Michael J. Guzman said, according to the network’s press release. “The law is clear: competition, not coercion, should decide what news channels Americans can watch. By leveraging its must-have status, Fox has blocked new voices, suppressed consumer choice, and extracted excess profits.”

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Newsmax CEO Christopher Ruddy said the lawsuit is about “restoring fairness to the market and ensuring that Americans have real choice in the news they watch,” according to the press release.

Neither Fubo nor Sling immediately responded to the DCNF’s request for comment.

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