Policy

Service Electric Sues Over Rival

3/25/2004 6:15 AM Eastern

Service Electric Cable TV Inc. has filed a federal lawsuit challenging a competitive franchise that regulators in Hazelton, Pa., awarded to another company.

The lawsuit -- filed March 23 in U.S. District Court for the Middle District of Pennsylvania Service -- asserted that Service Electric’s 17-year franchise with the city "grants unto the company exclusive rights and privileges to construct, erect, operate and maintain a cable-television system."

The suit claimed that Hazleton breached Service Electric’s contract by franchising a new competitor called NuNet Inc.

The Telecommunications Act of 1996 banned exclusive cable franchises, but previous court rulings have resulted in opposing views on whether that ban can be applied to franchises that predate the act.

A suit brought by Cox Communications Inc. ended when an 11th Circuit panel ruled that cities can’t sign exclusive contracts. But in a later challenge -- this time in the Sixth Circuit, in a suit by James Cable Partners -- the court found that retroactivity can’t be inferred by the Cable Act.

Service Electric wants the court to permanently enjoin Hazleton from acting on NuNet’s franchise.