News Corp. to File Suit Against Rival Time Warner

News Corp. said Tuesday that it will file a lawsuit today against Time Warner Inc. over its refusal to carry the Fox News Channel on its New York City cable system, turning the heat up a notch in a long-simmering brawl.

News Corp. said it will charge Time Warner, Turner Broadcasting Systems Inc. and Ted Turner with an antitrust conspiracy. The suit will be filed in U.S. District Court for the Eastern District of New York.

The planned suit comes after Time Warner’s decision not to carry News Corp.’s Fox News Channel, which began service Tuesday. The Fox channel is a competitor of Turner Broadcasting’s CNN. Turner is being acquired by Time Warner in a merger that is expected to be completed Thursday.

“The suit will allege that the conspiracy has taken place prior to the still-to-be consummated merger,” Arthur Siskind, general counsel of News Corp., said in a statement. He said the suit also charges Time Warner with breach of contract and fraud.

Time Warner executives couldn’t be reached for immediate comment.

The action by News Corp. comes after the New York attorney general said he is investigating Time Warner for possible anti-competitive behavior in the operation of its cable-TV system in New York City.

The New York-based media company received a subpoena Tuesday from the state attorney general’s office requesting internal documents relating to how it decides what stations are aired on the cable system.

Time Warner and Turner executives were not immediately available for comment.

The Fox News Channel flap has caused a stir in New York City, where Mayor Rudolph Guiliani has created a special panel to review whether Time Warner’s cable franchise in the city should be pulled or altered.

Guiliani said he wants Time Warner to carry the Fox news channel because it is based in New York and could fail if it isn’t aired there. Time Warner cited limited channel capacity for its decision to run the MSNBC channel instead, which is a joint venture by NBC and Microsoft Corp.