By Mike Scarcella

WASHINGTON, Dec 17 (Reuters) - Streaming and satellite TV provider DirecTV has persuaded a U.S. appeals court to revive its antitrust lawsuit accusing Nexstar Media Group NXST.O and two affiliated broadcasters of scheming to drive up retransmission fees for distributing content to viewers.

The New York-based 2nd U.S. Circuit Court of Appeals in a divided ruling on Tuesday reversed a lower judge’s order dismissing the case, concluding that DirecTV plausibly alleged it was harmed even though it refused to pay the allegedly high rates.

DirecTV said in its lawsuit in 2023 that Nexstar and station owners Mission Broadcasting and White Knight Broadcasting violated antitrust law by depriving it of a fair competitive process for rights to rebroadcast their channels in specific markets.

The opinion by Circuit Judge Steven Menashi said DirecTV’s claim of lost profits when it was unable to distribute certain channels amounted to sufficient harm to pursue its case under the antitrust laws.

Judge Richard Sullivan wrote a dissent, asserting that DirecTV’s injuries were indirect and speculative. He warned that allowing claims by buyers like DirecTV that did not pay the fixed prices “undercuts the very foundation of the antitrust laws."

Nexstar in a statement on Tuesday said it disagreed with the appeals court order and believes the lower judge’s ruling was correct. “We look forward to the next phase of the legal process,” Nexstar said.

DirecTV chief legal officer Michael Hartman in a statement welcomed the 2nd Circuit’s decision.

Nexstar and the other defendants “have made a mockery of existing broadcast ownership rules, resulting in ever-increasing retransmission consent fees at consumers’ expense,” Hartman said.

DirecTV in its lawsuit claims it was forced to choose between paying inflated prices or losing access to popular broadcast television programming.

After DirecTV declined to pay the demanded fees, it said it lost nearly one million subscribers, and thousands canceled service.

The case is DirecTV LLC v. Nexstar Media Group et al, 2nd U.S. Circuit Court of Appeals, No. 24-981.

For DirecTV: Paul Mezzina of King & Spalding

For Nexstar: Lauren Zehmer of Covington & Burling

(Reporting by Mike Scarcella)

((Email: mike.scarcella@thomsonreuters.com; Phone: 202-985-8228.))