Legal Heat: Sunbeam Charges Nielsen With Blocking Rivals

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A lawsuit Nielsen faces in Miami now has higher stakes as the measurement company moves ahead with an IPO. If it somehow were found guilty of monopolistic practices before a public offering, investors could become jittery about the sturdiness of its business.  

But that's unlikely -- if only from a timing standpoint. A trial date in the case, in which Nielsen is being sued by Sunbeam Television, isn't until mid-January. Mandatory mediation is scheduled to start Monday in Boston.

Sunbeam, which owns the Fox affiliate (WSVN) in Miami, alleges in federal court that Nielsen has engaged in anti-trust violations by blocking competitors in TV measurement from entering the South Florida market. It also charges Nielsen's local people meters have been deficient in under-counting minority and other viewers, costing Sunbeam millions.

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In its latest filing for an IPO, Nielsen said the suit is without merit and intends to defend it vigorously.

Sunbeam, which also owns an NBC-CW duopoly in Boston, has not specified the damages it is seeking in federal district court in Miami. However, it has said Nielsen's actions have cost it $1 million-plus per month since October 2008.

As the mediation process loomed, Sunbeam pressed its case in court papers filed Monday. It said it has identified well over 100 individuals with potentially critical information in the matter. Some could provide depositions or even called at trial.

Many are Sunbeam or Nielsen employees. But others are well-known media research professionals, including CBS' David Poltrack and NBC Universal's Alan Wurtzel.

Also on the list is Michael Vinson, a vice president at Rentrak, a fledgling Nielsen competitor. Vinson previously worked at erinMedia, which attempted to challenge Nielsen several years ago, but settled an anti-trust suit against it in 2008.

Sunbeam also cites a number of top executives at cable operators, such as Comcast and Cox, after having charged Nielsen with signing prohibitive contracts with MSOs.

Frank Maggio, who headed erinMedia, has already given a deposition in the case, and Sunbeam has referred to him as knowledgeable about "exclusionary conduct by Nielsen."

Richard Spooner is listed and was deposed June 2. He also led a company that unsuccessfully looked to muscle in on Nielsen's turf, ADCom Information Services, by offering measurement of cable programming.

In court papers, Sunbeam also notes it has obtained documents from Arbitron, Comcast and the Media Rating Council, among others, that have been shared with Nielsen.

Last year, both Sunbeam and Nielsen submitted lists of persons of interest in court papers. Both included executives from Univision who could be pivotal in the case, since Sunbeam has charged Nielsen's methods with under-counting minority viewers in a heavily Hispanic market.

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