LOS ANGELES–(BUSINESS WIRE)–In a groundbreaking case before the United States Supreme Court, Entertainment Studios Networks, Inc. (“Entertainment Studios”) alleges that Comcast Corporation (“Comcast”) violated the Civil Rights Act of 1866, 42 U.S.C. § 1981 (“Section 1981”), which gives “all persons” the same right to “make and enforce contracts” as “is enjoyed by white citizens.” Section 1981 was enacted after the Civil War to bring former African American slaves into the economy of the country and enhance economic inclusion.
Entertainment Studios, owned by Byron Allen, who is an African American entrepreneur, produces television programming, owns and operates multiple television channels, and also has a motion-picture production and distribution company. Entertainment Studios’ channels, JusticeCentral.TV, Cars.TV, ES.TV, MyDestination.TV, Pets.TV, Comedy.TV, and Recipe.TV, are award-winning lifestyle channels with general audience appeal. They are carried by major multichannel video programming distributors, including Verizon FIOS, AT&T U-verse, DirecTV, Suddenlink, RCN, DISH, CenturyLink, and many other distributors.
Entertainment Studios alleges that since 2008, it has offered its channels to Comcast for cable carriage and has even offered JusticeCentral.TV with no license fee, but Comcast has steadfastly refused to contract with Entertainment Studios. The lawsuit alleges that Comcast refused to launch Entertainment Studios Channels because Comcast claimed it lacked capacity to carry the channels, while at the same time launching more than 80 lesser-known, white-owned channels. As the largest cable distributor, Comcast has more than enough bandwidth to carry the Entertainment Studios Channels; and of the more than 500 channels carried by Comcast’s major competitors—Verizon FIOS, AT&T U-verse, and DirecTV—Comcast carries every single one, except the Entertainment Studios Channels.
Entertainment Studios also asserts that it was told by one Comcast executive that it refused carriage because “we’re not trying to create any more Bob Johnsons.” Bob Johnson is the African American founder of Black Entertainment Television, a groundbreaking network that was eventually sold to Viacom for $3 billion. The lawsuit alleges that Comcast did not want to support an African American media entrepreneur who would compete against the white-owned networks Comcast owns and/or carries.
Per Skip Miller, counsel for Entertainment Studios and partner with Miller Barondess, LLP in Los Angeles, “This case is about economic inclusion of African Americans in the media. It is critical to our country to break down racial barriers in business. I have tremendous respect for Byron Allen for his courage in taking on this case and firmly believe we are on the right side of the law. The data below, from our legal brief, illustrates the importance of this case.”
Today, the wealth gap between African Americans and white people remains significant. “Though black people make up nearly 13 percent of the United States population, they hold less than 3 percent of the nation’s total wealth. The median family wealth for white people is $171,000, compared with just $17,600 for black people.” Trymaine Lee, A Vast Wealth Gap, Driven By Segregation, Redlining, Evictions and Exclusion, Separates White and Black America, N.Y. Times Magazine (Aug. 18, 2019).
According to a January 2016 report from the Minority Business Development Agency, African American-owned businesses account for $150.2 billion in gross receipts whereas all U.S. firms account for $33.5 trillion. In other words, African American-owned firms account for roughly 0.4% of the gross receipts in the entire U.S. economy.
In the area of media ownership, the focus of this litigation, the picture is similarly dismal. “[A]ccording to the latest FCC analysis, people of color collectively owned 7 percent of all U.S. full-power commercial broadcast television stations, or just 98 of the nation’s 1,388 stations. (Though we note that a significant number even of these stations are only nominally owned by people of color, with broadcasters like Sinclair using shell companies headed by people of color to evade FCC ownership rules).” Written testimony of Craig Aaron (President and CEO of Free Press and Free Press Action) before the U.S. Senate Committee on Science, Commerce, and Transportation Subcommittee on Communications, Technology, Innovation, and the Internet Regarding “The State of the Television and Video Marketplace,” June 5, 2019, at 17. According to the Federal Communications Commission, in 2015 whites owned 1,030 stations (74.4%), while African Americans owned 12 stations (0.9%). Federal Communications Commission’s Third Report on Ownership of Commercial Broadcast Stations: Ownership Data as of October 1, 2015; released May 2017, at 7.
As Miller concluded, “Section 1981 is a critically important civil rights statute to ensure basic civil rights to African American-owned businesses. Comcast’s position would effectively shut the door of the federal courts to African Americans who were treated differently in contracting on account of race.”
About Entertainment Studios Networks, Inc. (“Entertainment Studios”):
In 1993, Byron Allen founded his Los Angeles-based global media company, Entertainment Studios. The company produces and distributes Emmy Award-winning and nominated shows, while selling advertising for 43 broadcast and cable television programs. Entertainment Studios has one of the largest libraries of family and advertiser-friendly lifestyle content in the world. For more information, please visit https://entertainmentstudios.com/.
About Miller Barondess, LLP:
Miller Barondess, LLP is a 35-lawyer firm in Los Angeles handling high-stakes litigation and trial work. Skip Miller is among the top trial lawyers in the nation, representing clients from celebrities to Fortune 500 companies to government in litigation matters. The firm’s attorneys hail from top law schools and aggressively and effectively litigate for their clients. For more information, please visit https://www.millerbarondess.com/.
Miller Barondess, LLP