Al Jazeera Says AT&T Dispute Details Should Stay Secret

Al Jazeera Satellite Network told Delaware’s highest court it shouldn’t be forced to make public the terms of a contract dispute that led AT&T Inc. to bar Al Jazeera America from its cable distribution system.

A state judge’s decision to order AT&T and Al Jazeera’s U.S. unit to disclose blacked-out contract terms as part of a lawsuit challenging the cable ban will put the Qatar-based broadcaster at risk of “serious economic loss,” an Al Jazeera lawyer told the Delaware Supreme Court today.

The court is reviewing Delaware Chancery Court rules governing when companies can withhold details in publicly filed lawsuits. The ruling may have wide effect given the state’s status as the corporate home to more than half of the publicly traded companies in the U.S. and more than three-fifths of Fortune 500 firms.

Constitutional mandates that court records are presumed to be public justified the lower-court’s finding that AT&T and Al Jazeera must disclose details outlining the specific nature of the dispute, Joel Friedlander, a lawyer for media outlets including Bloomberg News, told the Supreme Court.

“It’s a substantial dispute that affects the public in a substantial way,” Friedlander said. “You’re talking about a new network looking for access to the American market.”

‘Substantially Injured’

Andrew Deutsch, a lawyer for Al Jazeera, said the network showed that it will be “substantially injured” by disclosure of the agreement’s details.

“There’s no evidence that the public has any interest in the terms of this contract,” Deutsch said.

The chancery court is the highest-profile business-litigation forum in the U.S. and rulings go directly to the state’s Supreme Court for review.

“We didn’t take a position on Al Jazeera’s appeal, and we were not involved in today’s arguments,” Marty Richter, an AT&T spokesman, said in an e-mail. “This is Al Jazeera’s issue and not ours.”

Al Jazeera sued AT&T Inc., the largest U.S. phone company, in August 2013 over its refusal to carry the broadcaster’s new U.S. cable-news channel as part of its pay-television service. Large swaths of the complaint were blacked out as confidential.

Gore’s Network

AT&T’s U-verse pay-TV service said it wouldn’t carry Al Jazeera America because they couldn’t agree on terms. U-verse began in 2006 and has 5 million video customers in states such as Texas and California.

Al Jazeera, controlled by the Qatari royal family, paid $500 million for Al Gore’s money-losing Current TV and rebranded it. Buying Gore’s channel gave Al Jazeera America access to about 43 million U.S. homes, less than half of the nation’s pay-TV households.

Al Jazeera’s U.S. channel has about 800 staff at a dozen U.S. bureaus and brought in big-name personalities such as former CNN anchors Soledad O’Brien and Ali Velshi. Programs include “Real Money” with Velshi and current affairs program “Consider This” with former CBS News correspondent Antonio Mora.

Still, the channel must appeal to an American audience that remembers Al Jazeera as the forum for Osama bin Laden’s video messages after the terrorist attacks on the U.S. on Sept. 11, 2001. Ex-President George W. Bush considered the network sympathetic to terrorists, and the U.S. government was angered when Al Jazeera broadcast images of civilian casualties during a 2003 battle in the Iraqi City of Fallujah.

Boycott Fears

In the Delaware case, reporters for Bloomberg News and the Associated Press, along with a stringer for the New York Times, challenged the companies’ decision to black out parts of Al Jazeera’s suit against AT&T.

Delaware Chancery Court Judge Sam Glasscock concluded in October 2013 that AT&T and Al Jazeera wrongfully kept secret key terms of the contract dispute and ordered the companies to release most of the information.

Al Jazeera’s lawyers said in appellate-court filings AT&T officials admitted they were reluctant to allow the Qatari broadcaster to join its TV system for fear customers “could boycott or bring economic pressure against other AT&T services, such as cellular service.”

The companies said making the data public would give competitors an advantage. That material also was blacked out in appellate filings.

Closed Courtroom

To allow the appellate judges to hear arguments about the confidential details, Supreme Court officials closed the courtroom to the press and public for the first 20 minutes of today’s hearing.

In the public session, Deutsch argued that if the Supreme Court backed Glasscock’s interpretation of the redaction rules, companies would have few protections for their proprietary information in Delaware litigation.

“It won’t matter how much harm you suffer if the public wants to know” the confidential details of the dispute being litigated, Al Jazeera’s lawyer said.

The case is Al Jazeera America LLC v. AT&T Services Inc., No. 600, 2013, Delaware Supreme Court (Dover). The chancery case is Al Jazeera America LLC v. AT&T Services Inc., CA 8823, Delaware Chancery Court (Wilmington).

    Before it's here, it's on the Bloomberg Terminal. LEARN MORE