Nexstar Broadcasting, Inc. v. Fidelity Communications Co.

376 S.W.3d 377, 2012 WL 3636900, 2012 Tex. App. LEXIS 7162
CourtCourt of Appeals of Texas
DecidedAugust 24, 2012
DocketNo. 05-11-00220-CV
StatusPublished
Cited by12 cases

This text of 376 S.W.3d 377 (Nexstar Broadcasting, Inc. v. Fidelity Communications Co.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nexstar Broadcasting, Inc. v. Fidelity Communications Co., 376 S.W.3d 377, 2012 WL 3636900, 2012 Tex. App. LEXIS 7162 (Tex. Ct. App. 2012).

Opinion

OPINION

Opinion By

Justice LANG.

Nexstar Broadcasting and Mission Broadcasting (Licensees) appeal from a [378]*378take-nothing summary judgment respecting their breach of contract claim against Fidelity Communications. Licensees are owners of the broadcast licenses of four television stations, and Fidelity is the owner of a regional cable television system. Pursuant to their contract, Fidelity agreed to pay Licensees for the right to retransmit the signals of the four television stations to subscribers of Fidelity’s cable systems. The central point of disagreement is how Fidelity’s payment to Licensees is to be calculated under the agreement.

In two issues, Licensees argue the trial court erred in granting Fidelity’s motion for summary judgment, denying Licensees’ motion for summary judgment, and thereby concluding Fidelity’s interpretation of the payment terms of the agreement was the sole reasonable interpretation. We decide Licensees’ issue against them and affirm the trial court’s judgment.

I. FACTUAL AND PROCEDURAL BACKGROUND

Licensees own the Federal Communication Commission licenses for operation of television broadcast stations KOLR and KSFX of Springfield, Missouri, and KFDX and KJTL of Wichita Falls, Texas. Each station has a unique broadcast signal and programming content. On December 31, 2008, Licensees entered into a Retransmission Consent Agreement (the Agreement) with Fidelity, the owner of a regional cable television system.1 Under the terms of [379]*379the Agreement, Fidelity has been retransmitting the broadcast signals of Licensees’ two Springfield broadcast stations to Fidelity’s subscribers in three Missouri cities: Salem, Lebanon, and Rolla. Also, Fidelity has been retransmitting the signals of Licensees’ two Wichita Falls broadcast stations to Fidelity’s subscribers in Lawton, Oklahoma. Accordingly, each Fidelity subscriber in each location has been receiving the signals of two of Licensees’ stations. In exchange, Fidelity agreed to compensate Licensees based, in part, on the number of Fidelity’s cable subscribers.

This dispute arose in March 2009 when Licensees notified Fidelity that its monthly payments were less than the sum required by the Agreement. Fidelity disagreed and refused to change its calculation of the payments. This lawsuit followed.

Licensees claim Fidelity must pay a monthly fee specified by section 3 and Attachment B of the Agreement to each of the broadcast stations for each of Fidelity’s subscribers receiving that station’s signal. Pursuant to Licensees’ interpretation, because each of Fidelity’s subscribers receive two broadcast station signals, Fidelity must pay two of the monthly fees specified in the Agreement for each subscriber. Fidelity claims the Agreement makes no such requirement. Rather, Fidelity asserts, pursuant to section 3 and Attachment B, it need pay only one monthly fee for each subscriber and that is paid to Licensees, not the individual broadcast stations. This disagreement as to how Fidelity’s payments are calculated stems, in particular, from the parties’ disparate interpretations of the term “Station” in the Agreement’s introductory sentence.

The term “Station” appears in this introductory sentence of the Agreement, which states:

This Agreement is made as of the 31st day of December, 2008 by and between Nexstar Broadcasting, Inc., and Mission Broadcasting Inc., the licensees (or owner of licensees) of television broad[380]*380cast stations KOLR and KSFX, Springfield, MO and KFDX and KJTL, Wichita Falls, TX (hereinafter, collectively, referred to as the “Station”), and Fidelity Communications, owner of a cable television system serving the communities of (See Attachment A) (hereinafter, said owner and system referred to collectively as the “System”).

(Emphasis added).

Our first step in addressing this dispute is to interpret the meaning of “Station.” Licensees contend the lánguage shows “Station” refers to each broadcast station individually — KOLR, KSFX, KFDX, and KJTL. Fidelity disagrees, contending the term “Station” in this introductory sentence refers to Licensees Nexstar and Mission. Our second step is to determine how, if at all, the meaning of “Station” directs calculation of Fidelity’s payment under the Agreement. In that regard, we must consider section 3, titled “Compensation,” and Attachment B to determine whether the Agreement unambiguously identifies a single method for calculating Fidelity’s payment. Section 3 states, in part, “[Fidelity] agrees to make monthly payments to Station ... per the schedule displayed as ‘Attachment B[.]’ ” Attachment B provides, in part, for “[t]otal compensation to equal 30 cents per subscriber per month” for subscribers in Salem, Lebanon, and Lawton and “10 cents per subscriber per month” for subscribers in Rol-la.2

The dispute as to how fees are to be calculated is best described by setting out in detail how each party calculates the fees. Licensees assert because each subscriber receives exactly two signals, Fidelity should pay “compensation” per subscriber (as identified in Attachment B) of 30 cents per month for each signal received for each subscriber located in Salem,-Lebanon, and Lawton. This payment must be made to each “Station,” i.e., each broadcast station, for the transmission of its signal. That total would be 60 cents per subscriber per month, for each subscriber in Salem, Lebanon, and Lawton. As to the Rolla subscribers, Licensees contend Fidelity should pay 10 cents per month per signal received, for a total of 20 cents per subscriber per month. As with the signals received in Salem, Lebanon, and Lawton, Licensees argue “Station,” i.e., each broadcast station, must be paid this fee for the transmission of its signal. Of course, Fidelity disagrees, contending that “Station” refers to Licensees. Further, according to Fidelity, when one applies that meaning of “Station” to the compensation provisions (section 3 and Attachment B), one must conclude Fidelity should pay Licensees 30 cents per subscriber per month for those subscribers in Salem, Lebanon, and Lawton and 10 cents per subscriber per month for those subscribers in Rolla, not twice those sums per subscriber as argued by Licensees.

After discovery, both parties asserted that the Agreement was unambiguous and each moved for a favorable summary judgment. The trial court granted Fidelity’s motion and denied Licensees’ motion, entering a take-nothing judgment in favor of Fidelity. This appeal followed.

In their sole issue, Licensees argue the trial court erred in granting Fidelity’s motion for summary judgment because Fidelity failed to demonstrate that “Station” is reasonably susceptible only to Fidelity’s interpretation. Licensees make four specific, alternative arguments as to why the trial court erred in granting summary judgment in favor of Fidelity: (1) the [381]*381Agreement unambiguously supports Licensees’ interpretation of “Station,” which is the only reasonable interpretation; (2) none of Fidelity’s interpretations of “Station” is reasonable; (3) Licensees’ interpretation of “Station” is one of many reasonable interpretations, rendering the Agreement ambiguous; and (4) there is no reasonable interpretation of “Station,” rendering the Agreement ambiguous.

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Cite This Page — Counsel Stack

Bluebook (online)
376 S.W.3d 377, 2012 WL 3636900, 2012 Tex. App. LEXIS 7162, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nexstar-broadcasting-inc-v-fidelity-communications-co-texapp-2012.