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Attempts to block monopoly of government tabloid fail

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    NMU         THIRD CIRCUIT         Press at Home & Abroad         Feb 29, 2000    

Attempts to block monopoly of government tabloid fail

  • A government-controlled newspaper that can be distributed where no other newspapers can will not be blocked by court order.

Philadelphia Newspapers Inc., the New York Times Co. and Gannett Satellite Information Network Inc. hit a roadblock at the U.S. Court of Appeals in Philadelphia (3rd Cir.) on Feb. 16 in their attempt to halt the distribution of Metro, a free tabloid distributed in Philadelphia’s subway, bus and trolley stops, where other newspapers are not allowed to be sold.

The Southeastern Pennsylvania Transportation Authority (SEPTA) owned publication has faced two lawsuits in the past few months alleging the paper violates the First Amendment by promoting government control over a newspaper and cornering a distinct market. Michael Schwartz, attorney for the publishers, said they will appeal the Third Circuit’s decision.

“We had hoped the court of appeals would have recognized the serious constitutional issues at hand in this case,” he said. “Government cannot select one newspaper over others.”

According to the Associated Press, in a five-year contract, Metro guaranteed SEPTA a minimum of $30,000 per month in advertising revenue and $15,000 per month in costs to help clean up discarded newspapers. In exchange, Metro is to be distributed at 852 locations in SEPTA’s coverage area. The contract also states each issue must conform to SEPTA’s editorial and advertising policies.

Federal District Court Judge Robert Kelley denied the request for an injunction against distribution of Metro, contending the publishers failed to show they “will suffer immediate and irreparable harm” from SEPTA’s deal with Metro. Federal appellate Judge Dolores Sloviter denied the request for an injunction as well.

Philadelphia’s Metro is the first paper to be launched in the United States from the Stockholm, Sweden based Metro International. The company is currently looking to strike other deals with city transit systems across the country, but a court decision in Chile may put those efforts on hold. Chile’s Supreme Court unanimously decided Feb.1 to temporary halt the distribution of Metro and ordered the government-run mass transit agency to get out of the newspaper business.

(Philadelphia Newspapers, Inc. v. SEPTA; Media Counsel: Michael Schwartz, Philadelphia)

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