Nielsen To Appeal Antitrust Injunction, But Judge Refuses To Pause Order.

Nielsen will move forward with an appeal of a federal judge’s antitrust injunction but will not receive relief from the order while that appeal plays out. U.S. District Judge Jeannette Vargas has rejected the company’s request to pause enforcement of her ruling while the rating company challenges her decision in the Second Circuit Court of Appeals.

Vargas sided with Cumulus Media and agreed to issue a preliminary injunction that bars Nielsen from enforcing its Network Policy and from “charging a commercially unreasonable rate” for its Nationwide Report as a complete, standalone product. In a Jan. 12 decision, she concluded the broadcaster demonstrated irreparable harm and a strong likelihood of success on its claims that Nielsen unlawfully used monopoly power to tie national and local radio ratings products.

Nielsen maintains its policies and practices are “legally compliant,” and has vowed to fight to keep them in place, telling the court that it intends to appeal the Vargas ruling. The ratings company says the preliminary injunction order should be frozen pending review by the Second Circuit, warning that it interferes with the company’s pricing discretion, and distorts ongoing negotiations.

Nielsen asked Vargas to voluntarily put a stay to her ruling while it moved forward with the appeals court challenge. It says there are “serious questions” with her ruling, including too much focus on whether Nielsen’s offered price was “economically unfeasible” for Cumulus Media to pay. Nielsen says that is an exercise for which courts are “ill suited.” Its lawyers also believe that Vargas used incorrect legal framework, suggesting she relied on standards that usually apply in a merger case.

Nielsen also suggested that it would “suffer irreparable harm” if the injunction were allowed to remain in place. Its legal team also argues Vargas’ decision failed to adequately detail what is off-limits. Nielsen suggested Cumulus Media could simply subscribe to the numbers and seek to recoup monetary damages later.

Injunction Remains

Despite the forthcoming appeal, Vargas has ruled that her injunction against Nielsen will remain in place. She thinks the ratings company is unlikely to convince the Second Circuit of its arguments and says tying the sale of national ratings to the purchase of local market data remains off-limits.

Nielsen also argued that it had offered Nationwide ratings on a standalone basis and that the court improperly stepped into the role of price regulator. But Vargas disagrees with that, too. She points to the size of the price differential involved. Her order says Nielsen’s standalone offer, which is 10 times more than Cumulus Media currently pays for the essential product, could be used as an end-run around her order, putting the tying policy on ice.

While Vargas acknowledged Nielsen’s concerns that the injunction could affect negotiations with other customers and complicate cost recovery, she concludes in an eight-page order that those risks did not outweigh the broader equities. “The purpose of relief in an antitrust case is, so far as practicable, to cure the ill effects of the illegal conduct, and assure the public freedom from its continuance,” she writes.

On the public interest question, Vargas says she was “not persuaded” that a stay was warranted, emphasizing that the radio industry has an interest in enforcement of the antitrust laws and in the preservation of competition.

Although the court denied Nielsen’s request for a stay pending appeal, Vargas granted a short administrative pause. The injunction will be temporarily stayed until Friday, Jan. 16 to allow Nielsen time to seek relief from the Second Circuit.