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'A very bad day for our country': TV mogul Byron Allen criticizes Supreme Court ruling on $20 billion bias suit

Max Zahn
Reporter

Television mogul and comedian Byron Allen sharply criticized a U.S. Supreme Court decision on Monday that dismissed a lower court ruling that had allowed him to move forward with a case alleging racial discrimination committed by cable giant Comcast.

Allen, the chief executive of Entertainment Studios Inc., claims 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 last year that the case could proceed, and the Supreme Court announced in June that it would hear the case. The Supreme Court’s unanimous ruling on Monday sends the case back to the 9th U.S. Circuit Court of Appeals to reconsider its decision. In an opinion written by Justice Neil Gorsuch, the court ruled that Allen had to demonstrate that “but for race,” Comcast would have licensed his channels.

"This is a very bad day for our country,” Allen told Yahoo Finance in a statement. “Unfortunately, the Supreme Court has rendered a ruling that is harmful to the civil rights of millions of Americans.”

Allen vowed to pursue a solution through federal legislation.

“We will continue our fight by going to Congress and the presidential candidates to revise the statute to overcome this decision by the United States Supreme Court, which significantly diminishes our civil rights,” he says in the statement.

In its own statement, Comcast said it was pleased that that the high court had “restored certainty” as to the standard required to bring civil rights claims.

“The well-established framework that has protected civil rights for decades continues.  The nation’s civil rights laws have not changed with this ruling; they remain the same as before the case was filed,” Comcast stated. “We now hope that on remand the 9th Circuit will agree that the District Court properly applied that standard in dismissing Mr. Allen’s case three separate times for failing to state any claim.”

The company added: “We are proud of our record on diversity and will not rest on this record. We will continue to look for ways to add even more innovative and diverse programming that appeals to our diverse viewership and continue our diversity and inclusion efforts across the company.”

A dispute involving a 154-year-old civil rights law

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.

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

(Verizon is the parent company of Yahoo Finance.)

In an interview on “Influencers with Andy Serwer,” taped in July, Allen told 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.

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 to Yahoo Finance in November. “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.”

Byron Allen, the chief executive of Entertainment Studios Inc., appears on "Influencers with Andy Serwer."

In a statement to Yahoo Finance, also in November, Charter Communications rejected 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 had dismissed Allen’s lawsuit, but last 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. However, the Supreme Court on Monday disagreed with the 9th Circuit’s reasoning.

Comcast appealed, sending the case to the Supreme Court.

Allen came up as a comedian and still performs, but he turned to business 27 years ago when he launched Entertainment Studios Inc. Today, the production company counts nine TV networks to its name. Allen made headlines in 2018 when he acquired the Weather Channel for $300 million.

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