After receiving a large donation from the owner of a group of cable TV networks, House Speaker Nancy Pelosi (D) “coincidentally” attempted to block a TV station merger deal, the New York Post reported on Wednesday.
Byron Allen, a former stand-up comedian who now owns a media empire, has been seeking to broaden his company’s distribution by securing a deal with Tegna, a chain of 64 local television stations. However, the deal unraveled last year because of financing issues.
In the fourth quarter of 2021, around the same time Allen’s deal was crumbling, he donated $271,300 to Pelosi, according to Federal Election Commission filings. It was his only on-record contribution to Pelosi’s campaign.
During the same quarter, Allen also donated $275,000 to the Democratic Congressional Campaign Committee. According to FEC filings, the committee backs Democratic candidates for the House.
In February, the hedge fund Standard General secured a deal to purchase Tegna for $8.6 million.
Pelosi is now trying to prevent the merger, even though Tegna does not have any television stations in her San Francisco congressional district.
On October 6, Pelosi wrote a letter with Energy and Commerce Committee Chair Frank Pallone Jr. to FCC Chairwoman Jessica Rosenworcel voicing “serious concerns” about the Tegna deal with Standard General.
The letter stated that Pelosi and Pallone are worried that the merger will lead to higher cable bills, station job cuts, and diminished local news coverage.
A week before Pelosi sent the letter, the FCC requested more information from Standard General and Tegna. As a result, the deal’s closing date, which was initially scheduled for October 18, was pushed back several weeks. According to the New York Post, one lawyer speculated that the House’s Office of Legislative Affairs may have informed the FCC chairwoman ahead of time that a letter would be coming.
“You don’t want to surprise an agency head when they are in your own party,” the lawyer said.
Standard General wrote to the FCC stating that it has no plans to cut jobs or reduce local news coverage. The hedge fund said it “made a commitment in the FCC record that it was not planning any such actions.”
“If she is helping out a major donor it doesn’t look good, quite frankly,” Craig Holman, the Capitol Hill lobbyist for advocacy group Public Citizen, told the New York Post. “When it comes to campaign finance, this is often how it works. A donor gives money with the expectation of some return.”
“It is legal unless there is an actual agreement between the parties. Then it is a bribe,” Holman stated. “But when there is no obvious agreement, it does not run afoul of the law.”
Mark Lipp, a partner at law firm Fletcher, Heald & Hildreth who worked at the FCC for 14 years, told the New York Post that politicians have pressured the FCC on behalf of donors in the past, but “since she has no constituent who would be affected, it is unusual.”
“I’ve seen some commissioners withstand that kind of pressure and seen others buckle,” Lipp said. “That sounds like more than a coincidence.”
Henry Connelly, a spokesperson for Pelosi, declined to comment on Allen’s campaign donations, reported the news outlet. However, Connelly noted that Pelosi and Pallone also reached out to the FCC with similar concerns in 2017 regarding Sinclair Broadcasting’s deal to purchase stations from Tribune Broadcasting.
“Evidently, there are some ‘legal experts’ who will be surprised to learn that the speaker of the House of Representatives does in fact routinely weigh in on issues of national importance, not just her own district,” Connelly said. “Democrats have long expressed concerns to the FCC about the consolidation of local news outlets raising costs on consumers and hollowing out the local news reporting that is vital to the health of our democracy.”
Allen told the New York Post that his “donations to numerous Democratic politicians and PACs have nothing to do with Tegna and everything to do with protecting our democracy.”
A spokesperson for the FCC told the news outlet, “Under long-standing precedent, the Commission does not comment on pending transactions. In this case – as in all cases – the Commission has a statutory obligation to determine that an assignment or transfer serves the public interest.”