Telecommunications giant AT&T is negotiating a settlement with the U.S. Justice Department to resolve allegations that DirecTV executives improperly colluded with other pay-TV providers three years ago, effectively blocking carriage of the Los Angeles Dodgers' television channel in Southern California.
A settlement could come in the next two weeks. However, in a move that would probably disappoint thousands of Dodger fans, the proposed settlement would not require AT&T or its DirecTV subsidiary to begin carrying SportsNet LA, according to a person close to the negotiations who was not authorized to publicly discuss the matter.
That means the Dodgers channel shutout — which is about to enter its fourth season — will continue unless AT&T agrees on its own to carry the channel on its DirecTV and U-Verse pay-TV systems. DirecTV is the second-largest pay-TV provider in the Los Angeles region with about 1.5 million subscriber homes. Its unwillingness to carry SportsNet has been a major obstacle in getting wider carriage for the channel.
AT&T declined to comment Thursday.
The Dallas company appears to be motivated to resolve the Justice Department lawsuit because it also is seeking that agency's approval for its proposed $85-billion takeover of Time Warner Inc., which owns such prominent properties as HBO, CNN, TBS, the Cartoon Network and the Warner Bros. film and TV studio in Burbank.
"The parties are currently engaged in productive settlement negotiations," attorneys for the government and AT&T wrote in a court filing this week.
The Justice Department sued AT&T and its DirecTV subsidiary in November, alleging that Dodgers baseball fans had been shut out of the action because of unfair play by DirecTV. The government alleged that DirecTV's chief content officer, Dan York, colluded with rivals in an effort to make sure that other pay-TV companies would join him in refusing to carry the Dodgers channel. The effort stymied efforts in early 2014 to get wide carriage for the channel.
Charter Communications remains the only pay-TV company that carries SportsNet LA.
In its lawsuit, the government stopped short of demanding that AT&T distribute SportsNet LA. Instead, it asked that AT&T and DirecTV agree to no longer share non-public information with competitors. The government also asked that AT&T monitor conversations of its employees who negotiate pay-TV deals to make sure there were no further violations of the Sherman Act.
The Los Angeles Dodgers, who own the television channel, had hoped the government's lawsuit would finally break the logjam that has prevented tens of thousands of Dodger fans from regularly watching the team's games on TV.
This week, Charter reached a deal with Tribune Media for 10 Dodger games to be simulcast on Tribune's KTLA-TV Channel 5 in Los Angeles in April and early May.