A federal appeals court has overturned part of a 2008 loosening of U.S. media-ownership rules that made it easier to own a newspaper and a broadcast outlet in a single market.
The U.S. Court of Appeals for the Third Circuit said on Thursday that this cross-ownership portion of the Federal Communications Commission's order had failed to meet notice and comment requirements set out by law.
The court's narrow ruling on procedural grounds left most of the 2008 order intact along with the FCC's authority to preserve media competition, a blow to proponents of fewer ownership restrictions such as the National Association of Broadcasters.
"At first glance the ruling appears to be a defeat for the broadcast/newspaper industries," said Stifel Nicolaus analysts in a note to clients.
In late 2007, the FCC narrowly approved a loosening of its three-decade-old restrictions on ownership of a newspaper and broadcast outlet in the 20 biggest U.S. cities, over the objections of consumer groups and some lawmakers.
The decision by then-FCC Chairman Kevin Martin, with the support of his two Republican colleagues, was challenged by public interest groups seeking greater competition and diversity in the industry.