Newsmax on Wednesday filed an antitrust lawsuit against Fox News, claiming the news outlet has maintained its dominance among right-leaning cable, satellite and streaming networks via an “exclusionary scheme” to suppress competition.The lawsuit, filed in federal court in Florida, also names Fox Corporation as a defendant.Newsmax claimed that Fox “employs at least three anticompetitive means to exclude competing providers of right-leaning video content from the market.” They include “explicit or tacit” “no carry” provisions on distributors that condition access on concessions not to carry other right-leaning news channels like Newsmax.The lawsuit also claimed that Fox imposes penalties on distributors if they carry other right-leaning news channels on their basic tiers, by requiring them to carry and pay high fees for lesser watched channels like Fox Business and Fox Sports 2.Newsmax also claimed that Fox “inserts a suite of other contractual barriers into its carriage agreements intended to prevent Newsmax and others from competing,” characterizing Fox as having an “unlawful monopolization” of the right-leaning pay-TV news market.The lawsuit claimed that Fox’s “anticompetitive behavior” 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.”Read Newsmax’s lawsuit against Fox News.A Fox News spokesperson said, “Newsmax cannot sue their way out of their own competitive failures in the marketplace to chase headlines simply because they can’t attract viewers.”A Newsmax spokesperson responded, “If Newsmax was such a ratings failure, why has Fox spent so much time, energy, and resources to suppress us, block us, and denigrate us? The answer is obvious. Also please note that Fox in its statement does not deny any of our serious allegations.”A key argument in any antitrust case is on the relevant market. Fox News has often promoted its dominance across all news channels, and even across cable TV, a much wider competitive landscape than the one defined by Newsmax.In its lawsuit, Newsmax argued that the narrower market for right-leaning pay-TV news channels was distinct from that for general news. Newsmax noted that “consumers who desire right-leaning commentary are much more likely to switch to a channel that shares their ideological perspective than one with a different viewpoint. Right-leaning viewers demonstrate minimal switching to non-right-leaning news outlets like CNN or MSNBC.”The lawsuit took particular aim at what Newsmax described as Fox’s “drag-down” provisions in carriage agreements. Under such tactics, according to the lawsuit, if a distributor wanted to place Newsmax into its basic tier “at little or even at no cost,” the distributor “would be subject to potentially tens of millions in additional license fees paid to Fox for the low-demand channels that are subject to the drag-down provisions.”Newsmax claimed that such restrictions have prevented it from being carried on Fubo’s sports and entertainment package, as well as on Sling TV’s two base plans, while delaying placement on other platforms.Newsmax also claimed that it has “faced threats and smear intimidation tactics to hurt or undermine the company and its executives.” Those included Fox hiring, “by itself or through cutout corporations or law firms, private detective firms to investigate Newsmax executives,” according to the lawsuit. Newsmax also suggested that social media firm Disruptor has been linked to Fox and engaged in a campaign to spread negative tweets about Newsmax CEO Chris Ruddy.Newsmax is seeking three times the amount of damages it has suffered, although those were not specified in the lawsuit, as well as an injunction and other relief.
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