Univision CommunicationsInc. filed a lawsuit against CharterCommunications Inc. and related entities alleging that the company isnot honoring commitments it made regarding how its carriage contract with the programmerwould be handled following a change in corporate ownership like Charter's recentmerger with
Univision's carriage agreement with legacy Time Warner Cablehad been slated to run through June 2022 prior to the merger, while Univision'scontract with Charter expired June 30. According to the lawsuit, Charter delayednegotiations to renew its contract and is now insisting that the programmer's contractwith Time Warner Cable is applicable to both cable systems.
In addition to pushing for Univision to accept a carriage rate"dramatically below current market license fees" for its programming,Univision alleged that the newly merged company is violating a clause in Charter'sagreement with Univision that specified how the contract was to be handled in theevent of an acquisition.
The "heavily-negotiated provision" specified that:"If Charter or any of its Affiliated Companies acquired the distribution systemsof another distributor, the purchased distributor would remain subject to the operativeagreement between Univision and that other distributor, but only until the end ofthe calendar year in which the acquisition occurred," according to the courtfiling.
The Charter-Time Warner Cable deal "clearly triggered" this provision, Univisionargued in its lawsuit, adding as such, the legacy Charter systems were subject toUnivision's agreement with Charter while the legacy Time Warner Cable systems shouldhave been subject to Univision's agreement with Time Warner Cable, but only untilthe end of 2016.
Univision sought a declaratory judgment from the Supreme Courtof State of New York to clarify the language of its programming contracts with Charterand Time Warner Cable. The company is seeking unspecified damages foran alleged breach of contract and the covenant of good faith and fair dealing.
In a statement given to Variety,Charter said: "We have a long-term contract with Univision and we expect themto honor it."