Teamsters Warn Tribune Waivers Could Violate FCC Rules and Policies
October 31 2007 - 10:52AM
PR Newswire (US)
Union Urges Protection of Public Interest in Tribune Deal
WASHINGTON, Oct. 31 /PRNewswire-USNewswire/ -- The International
Brotherhood of Teamsters testified at today's Federal
Communications Commission (FCC) hearing regarding diversity and
localism in media ownership, raising concerns about the separation
of ownership and management under applications filed by the Tribune
Company (NYSE:TRB). The union also held a rally outside the hearing
in support of public interest protections. Applications by the
Tribune Company for transfer of ownership and waivers of the FCC's
newspaper/broadcast cross-ownership rules are pending before the
FCC. The proposed transaction would transfer 100 percent of the
company's ownership to an Employee Stock Ownership Plan (ESOP), but
give employees no voice in the governance of the plan or the
operating company. Rather, total control of the company would
reside with its new chairman, Sam Zell. George Tedeschi, Teamsters
International Vice President and President of the Graphic
Communications Conference of the Teamsters, testified at the
hearing on behalf of 2,000 Teamster-represented Tribune employees.
"Section 310(d) of the FCC's rules forbids a broadcast licensee
from giving third parties ultimate control over station personnel,
programming, and finances," Tedeschi said. "In other words, the
owners of a station must be the ones who have ultimate management
responsibility for the station. The Tribune-Zell transaction calls
this rule into question." -- Zell clearly would control the
Tribune, but he would not be an owner. Although a trust established
for the benefit of his family would hold notes and warrants and
would have the right to designate two of nine members of the
Tribune's board, neither Zell nor his family trust would be owners
of Tribune stock. -- The ostensible owners of the Tribune would be
the Tribune's employees, as beneficiaries of the Tribune ESOP Plan
that would hold 100 percent of the Tribune's stock. But as
proposed, the employees would have no role in the selection of the
Tribune's directors, who establish company policy and appoint the
officers who run the company; and would have no opportunity or
ability to select the Tribune ESOP Plan trustee. "This separation
of ownership and management is unprecedented and would set a new,
and very low, standard for compliance with the Communications Act's
public interest requirements, which are the basis for the localism
and diversity principles in broadcasting," Tedeschi said. Teamsters
General President Jim Hoffa called on the FCC to ensure protections
for the public interest in any action on the Tribune Company waiver
requests. "By rubberstamping the Tribune application, the FCC could
violate its own rules and policies which forbid a broadcast company
from giving ultimate control to an unaccountable third party,"
Hoffa said. Founded in 1903, the International Brotherhood of
Teamsters represents 1.4 million hardworking men and women in the
United States, Canada and Puerto Rico. DATASOURCE: International
Brotherhood of Teamsters CONTACT: Galen Munroe of the International
Brotherhood of Teamsters, +1-202-624-6904, Web Site:
http://www.teamster.org/
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