The Federal Communications Commission has found that the 2020 acquisition of New York’s WPIX-TV by local TV giant Nexstar Media Group violated federal restrictions on station ownership.

In a ruling Thursday (read it here), the regulator ordered Mission Broadcasting, Nexstar’s partner in WPIX, to sell the channel. If that doesn’t work out, Nexstar could put the station under its umbrella and then divest other stations in its portfolio to stay under the ownership limit. The FCC also fined the company $1.2 million.

Nexstar responded by promising to “vigorously” contest the decision.

Airing in 1948, WPIX was a fixture in New York media and became an affiliate of The CW in 2006. Nexstar, the No. 1 owner of U.S. TV stations, acquired control of The CW in 2022. has been operating WPIX since 2020 under a local marketing agreement with Mission. Such agreements, often described as “sidecar deals,” have come under scrutiny in recent years amid consolidation that reshaped the local TV industry, with regulators expressing concerns that the pacts could serve as a workaround to long-standing ownership rules.

Nexstar appeared to engage in “an unauthorized transfer of control” and broke the old limit of 39% of U.S. TV households that could be reached by a single owner, the FCC said in its ruling.

Nexstar CEO Perry Sook said in a statement that the company was “extremely disappointed” by the FCC’s decision, “and we intend to vigorously contest it.”

The regulator, he continued, “has been misled by the often distracting noise in the media ecosphere and has completely misjudged the facts. The facts are that Nexstar has always complied with FCC regulations.”

Nexstar’s acquisition of WPIX, Sook said, and the local marketing agreement were approved by the FCC in 2020, when WPIX-TV was purchased by Mission. “Nexstar believes that joint operating, shared service and local marketing agreements, such as those in which it is involved, are critical to maintaining a competitive media market and enabling broadcasters to continue investing in local news, investigative journalism and other services they uniquely offer to the communities in which they are located.”

Comcast had filed a complaint about WPIX’s ownership. In a statement, the company said: “After a thorough investigation, the FCC has determined that Nexstar is in clear violation of the FCC’s rules and orders and controls WPIX. We would like to thank the Commission for properly assigning ownership of WPIX to Nexstar and ending the fiction that the station would ever be independent once Mission became the licensee.”

FCC Chairman Jessica Rosenworcel noted that companies are prohibited from owning or controlling channels that reach more than 39% of the national television audience.

“The record here reflects a situation where a company exceeds this threshold,” she said in a statement. “Unless and until Congress changes this law, it is this agency’s responsibility to enforce it.”

Brendan Carr, one of two Republicans on the committee, made a concurring statement. “It concerns me that the FCC is citing as evidence of control those features of the relationship that the FCC previously signed off on,” he said. “We must be careful not to undermine reasonable reliance on prior FCC decisions.”

He said he would “keep an open mind as the FCC reviews the data in response to this document. Part of that will require the FCC to ensure that any actions the agency deems necessary are appropriate given the procedural posture of this enforcement action.”

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