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TV mogul says Supreme Court case against Comcast is about 'economic inclusion'

Max Zahn
Reporter

Wealth inequality has risen near the top of the agenda just about everywhere — the Democratic presidential race, the Business Roundtable, and even the Supreme Court, where next month justices will hear a $20 billion discrimination lawsuit brought by a television company whose CEO says he seeks no less than “economic opportunity for all Americans.”

Byron Allen, the chief executive of Entertainment Studios Inc., alleges that cable giant Comcast (CMCSA) refused to license his company’s channels — for instance, Cars.TV and Pets.TV — because he is black, claiming Comcast discriminates against minority-owned programming in its licensing agreements.

The 9th U.S. Circuit Court of Appeals, based in San Francisco, ruled earlier this year that the case could proceed, and the Supreme Court announced in June that it would hear the case.

NEW YORK, NY - OCTOBER 29: Byron Allen arrives at the Broadcasting & Cable Hall Of Fame In New York's Historic Ziegfeld Theatre on October 29, 2019 in New York City. (Photo by Dave Kotinsky/Getty Images for Entertainment Studios / Allen Media Group)

But in a newly released interview, Allen tells Yahoo Finance Editor-in-Chief Andy Serwer that the lawsuit is about more than just racial bigotry at the highest echelons of show business.

“I'm not a woman so I can't sue on behalf of women,” Allen says. “I can't sue on behalf of Hispanic people. I can't sue on behalf of gay people. If I could, I would.”

“My standing is as an African-American, and I want equal access for economic opportunity for all Americans,” he adds.

Civil rights lawsuits against Comcast and Charter

Allen’s company, Entertainment Studios, filed lawsuits against Comcast and Charter Communications (CHTR) in 2015 and 2016, saying both cable companies had violated the Civil Rights Act of 1866, which established the right of African Americans to enter into contracts as white individuals could. Allen points to the cable companies’ repeatedly declining to license his networks, in contrast with other distributors like Direct TV (T), Dish Network (DISH), and Verizon (VZ) that agreed to carry his programming.

(Verizon is the parent company of Yahoo Finance.)

Comcast and Charter Communications have rebutted the claim, arguing that they declined to carry the channels due to limited capacity to add programming.

“We believe that the civil rights laws are an essential tool for protecting the rights of African-Americans and other diverse communities,” Comcast spokesperson said in a statement. “We are fully aligned with the view that this case should never have happened and we continue to hope that Mr. Allen will do the right thing and withdraw his claim — a move that would promptly terminate the Supreme Court case and bring this entire episode to an end.”

“This case cannot detract from Comcast’s strong civil rights and diversity record or our outstanding record of supporting and fostering diverse programming from African-American owned channels,” the Comcast spokesperson added. “There has been no finding of discriminatory conduct by Comcast against this plaintiff by any court, and there has been none.”

In a statement to Yahoo Finance, Charter Communications also rebutted Allen’s claims and defend its commitment to diversity.

“Promoting diversity and inclusion are core objectives across our company from hiring and procurement, to the products and services we offer, including programming,” the statement said.

“This lawsuit is a business tactic and the allegations in it are entirely false. Race plays no role whatsoever in our programming decisions. We will defend ourselves while continuing our work to promote diversity and inclusion,” the statement adds.

A district court dismissed Allen’s lawsuit, but earlier this year the 9th U.S. Circuit Court of Appeals allowed the case to proceed, determining that racial discrimination could plausibly have contributed to the decision to forego Allen’s programming, and that the First Amendment could not be used to dismiss the case. The 9th Circuit decided that racial discrimination need only have contributed to the programming decision, rather than have been the determining factor.

Comcast appealed, sending the case to the Supreme Court.

Allen made the comments during a conversation that aired in an episode of Yahoo Finance’s “Influencers with Andy Serwer,” a weekly interview series with leaders in business, politics, and entertainment.

Allen came up as a comedian and still performs, but he turned to business 25 years ago when he launched Entertainment Studios Inc. Today, the production company counts nine TV networks to its name. Allen made headlines last year when he acquired the Weather Channel for $300 million.

Mandy Moore and Byron Allen, Chairman and CEO of Entertainment Studios, seen at Entertainment Studios Motion Pictures "47 Meters Down" Los Angeles Premiere at Regency Village Theatre on Monday, June 12, 2017, in Los Angeles. (Photo by Eric Charbonneau/Invision for Entertainment Studios Motion Pictures/AP Images)

‘We’re going to win’

Allen said he was confident that his company will prevail in the case.

“We're going to continue to win, we're going to win, and more importantly, we're going to change the way the world does business,” he says. “The world's going to do business with every American in a fair and equitable way.”

“We have to level the playing field,” he adds. “That's the reason for the lawsuits.”

The Supreme Court will hear oral arguments on Nov. 13 in the case against Comcast, but will not hear the case against Charter Communications, which will likely receive a ruling based upon the decision issued on Comcast.

Max Zahn is a reporter for Yahoo Finance. Find him on twitter @MaxZahn_.

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