Business & Tech

FCC watchdog looks into changes that benefited Sinclair

Ajit Pai, chairman of the FCC.
Tom Brenner/New York Times/File 2017
Ajit Pai, chairman of the FCC.

WASHINGTON — Last April, the chairman of the Federal Communications Commission, Ajit Pai, led the charge for his agency to approve rules allowing television broadcasters to greatly increase the number of stations they own. A few weeks later, Sinclair Broadcasting announced a blockbuster $3.9 billion deal to buy Tribune Media — a deal those new rules made possible.

By the end of the year, in a previously undisclosed move, the top internal watchdog for the FCC opened an investigation into whether Pai and his aides had improperly pushed for the rule changes and whether they had timed them to benefit Sinclair, according to Representative Frank Pallone of New Jersey and two congressional aides.

“For months I have been trying to get to the bottom of the allegations about Chairman Pai’s relationship with Sinclair Broadcasting,” Pallone, the top Democrat on the committee that oversees the FCC, said in the statement to The New York Times. “I am grateful to the FCC’s inspector general that he has decided to take up this important investigation.”


It was unclear the extent of the inspector general’s investigation or when it might conclude, but the inquiry puts a spotlight on Pai’s decisions and whether there had been coordination with the company. It may also force him to answer questions that he has so far avoided addressing in public.

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The inquiry could also add ammunition to arguments against the Sinclair-Tribune deal. Public interest groups and Democratic lawmakers, including Pallone, are strongly opposed to the deal, arguing that it would reduce the number of voices in media and diminish coverage of local news.

Sinclair’s chief executive, Chris Ripley, has called Pai’s relaxation of media ownership rules a “landmark” development for his company and the industry. A union of Sinclair and Tribune would create the nation’s biggest television broadcaster, reaching 7 out of 10 US homes. The FCC and Justice Department are widely expected to approve the merger in the coming weeks.

The office of FCC inspector general, which is a nonpartisan role that reports to the agency and regularly updates Congress on some investigations, said it would “not comment on the existence or the nonexistence of an investigation.”

Pai’s office and Sinclair declined to comment. When the legislators called for an investigation in November, a spokesman for the FCC, representing Pai, said the allegations of favoritism were “baseless.”


“For many years, Chairman Pai has called on the FCC to update its media ownership regulations,” the FCC spokesman said. “The chairman is sticking to his long-held views, and given the strong case for modernizing these rules, it’s not surprising that those who disagree with him would prefer to do whatever they can to distract from the merits of his proposals.”

A New York Times investigation published in August found that Pai and his staff members had met and corresponded with Sinclair executives several times. One meeting, with Sinclair’s executive chairman, took place days before Pai, who was appointed by President Trump, took over as FCC chairman.

Sinclair’s top lobbyist, a former FCC official, also communicated frequently with former agency colleagues and pushed for the relaxation of media ownership rules. And language the lobbyist used about loosening rules has tracked closely to analysis and language used by Pai in speeches favoring such changes.

In November, several Democrats in Congress, including Pallone, called on the inspector general’s office to explore all communications — including personal e-mails, social media accounts, text messages, and phone calls — between Sinclair and Pai and his staff.

The lawmakers also asked for communications between Pai’s office and the White House. They pointed to a report in March 2017 from The New York Post, in which Trump is said to have met with Sinclair’s executive chairman, David Smith, and discussed FCC rules.


Some members of Congress have asked Pai for such communications, but he has not responded.

The FCC inspector general, David L. Hunt, and other officials in his office met with aides in the House and Senate, including those for Pallone, in December. The FCC officials told the aides that they would open an investigation, according to four people with knowledge of the meetings.

In later conversations, FCC officials said that an investigation was underway, according to two other aides.

The aides, all of whom work for Democratic lawmakers, would speak only on the condition of anonymity because the investigation is private.

Antitrust experts said this new investigation may complicate the reviews of the Sinclair-Tribune deal by the FCC and the Justice Department. Even if the deal were approved, they said, any conclusions of improper conduct by Pai could give fuel to critics to challenge the review in courts.

“An investigation could cast a cloud over the whole process,” said Andrew Schwartzman, a senior fellow at Georgetown Law Center’s Institute for Public Representation. “For the review, knowledge of an investigation could generate caution and even delay completion of the deal.”