Television entrepreneur Byron Allen has filed a $20-billion racial discrimination lawsuit against cable giants Comcast Corp. and Time Warner Cable.
Allen, who is African-American, owns the Los Angeles television production and distribution company Entertainment Studios, which includes such digital channels as Justice Central, Cars.TV and Comedy.TV.
The lawsuit, filed in U.S. District Court in Los Angeles, contends that Allen’s company has been thwarted in his attempts to secure distribution for its small networks on cable systems owned by Comcast and Time Warner Cable.
The suit contends that while Comcast distributes for several channels that include minorities as part owners, the Philadelphia cable giant has not embraced Allen’s company, which is 100% minority owned.
“100% African American–owned media has been shut out by Comcast,” the lawsuit alleges. “Of the approximately $11 billion in channel carriage fees that Comcast pays to license television channels each year, less than $3 million is paid to 100% African American–owned media.”
The suit, filed late Friday, also claims civil rights violations.
On Monday, Comcast called Allen’s allegations “frivolous.” The company, in a statement, said it has been involved in “good faith negotiations” for several years to strike a carriage deal for Allen’s channels.
Allen is a former comedian and performer who served as co-host of NBC’s “Real People,” an early reality show. He formed Entertainment Studios in 1993 and produced such programs as “Comics Unleashed” and the sitcoms “Mr. Box Office” and “The First Family.”
His lawsuit comes as Comcast tries to secure the federal goverment’s blessing for its $45-billion takeover of Time Warner Cable, which includes cable systems in Los Angeles and New York.
The lengthy government review has prompted several companies to seek more favorable treatment in their business dealings with the nation’s largest cable company.
Last week, for example, Comcast refused to bend to the demands of Spanish-language network Estrella TV, which wanted Comcast to pay “retransmission fees” to carry its TV stations.
Comcast balked at the fees and subsequently lost its authorization to carry the Estrella TV station signals in Denver, Salt Lake City and Houston. Comcast said it was the first time in more than 50 years that “a programmer has pulled its signal from our customers.”
Five years ago, Comcast faced criticism for its diversity efforts during the federal review of its takeover of NBCUniversal.
As part of an 2011 agreement with the federal government, the Philadelphia company agreed to launch several channels backed by minorities, including the Aspire channel led by former basketball great Magic Johnson, the Revolt channel with music mogul Sean “Diddy” Combs and El Rey network with director Robert Rodriguez.
“We are proud of our outstanding record supporting and fostering diverse programming, including programming from African American owned and controlled cable channels,” Comcast said Monday in its statement.
“We currently carry more than 100 networks geared toward diverse audiences, including multiple networks owned or controlled by minorities,” Comcast said.
Allen’s lawsuit also took aim at NBCUniversal’s association with the Rev. Al Sharpton. NBCUniversal hired Sharpton after Comcast took control of the media company in 2011.
Comcast, Allen’s lawsuit contends, paid Sharpton and his National Action Network more than $3.8 million “in donations and as salary for the on-screen television hosting position on MSNBC.” Sharpton is paid $750,000 a year by NBCUniversal, the lawsuit said.
Sharpton was named as a defendant in his lawsuit as well as the NAACP and the Urban League, which also have received contributions from Comcast.
The suit comes nearly three months after Allen’s company sued AT&T Corp. for $10 billion in a separate racial discrimination suit. AT&T separately is seeking federal approval for its $49-billion take-over of DirecTV.
Allen’s TV channels have distribution through a small number of pay-TV systems, including Verizon and Century Link. The lawsuit said its channels are available in about 7.5 million homes, or about 8% of cable homes in the country.