Cunningham Broadcasting Corporation is an owner of television stations in the United States. The company currently owns six stations—four affiliated with Fox Broadcasting Company (one of which also carries MyNetworkTV on a digital subchannel), one affiliated with MyNetworkTV and one affiliated with The CW Television Network.
Cunningham has very close ties to Sinclair Broadcast Group. All six Cunningham stations are operated by Sinclair under local marketing agreements. In addition, over 90 percent of Cunningham's stock is controlled by trusts in the name of Sinclair founder David Smith's children. Based on these arrangements, Cunningham appears to be a shell corporation that Sinclair uses to circumvent Federal Communications Commission regulations on ownership.
Cunningham was founded in 1994 as Glencairn, Ltd. It was headed by Edwin Edwards, a former Sinclair executive. Edwards had been general manager of one of Sinclair's original stations, WPTT-TV in Pittsburgh. Sinclair sold WPTT to Edwards after Sinclair bought rival WPGH-TV, but continued to operate the station under a local marketing agreement before buying the station back outright in 2000.
The initial capital was supplied by Carolyn Smith, wife of Sinclair founder Julian Smith and mother of current Sinclair CEO David Smith. Carolyn Smith also controlled 70% of Glencairn's stock. However, Glencairn held itself out as a minority-owned broadcaster (Edwards is black), gaining instant favor with the FCC.
Glencairn's initial purchase set the stage for its future dealings. In 1994, Sinclair merged with Abry Communications, which owned WNUV in Baltimore. WNUV had been the principal rival to Sinclair's flagship station, WBFF. Sinclair could not keep both stations because FCC rules at the time did not allow common ownership of two stations in a single market. Accordingly, Glencairn bought WNUV from Sinclair, and Sinclair took over WNUV's operations under an LMA. However, due to the Smiths' controlling interest in Glencairn, Sinclair effectively had a duopoly in Baltimore--and had all but emasculated its principal rival.
Glencairn eventually bought ten more stations, and Sinclair controlled all their operations via LMAs. Due to Glencairn's financial structure (the Smiths eventually bought 97% of Glencairn's stock), Sinclair effectively had duopolies in all 11 markets. FCC rules at the time did not allow common ownership of two stations in a single market. Among the more notable purchases:
In 1999, the FCC finally relaxed its ownership rules and allowed one person to own two stations in a market starting in 2001. Ironically, this development brought the Sinclair-Glencairn arrangement to light for the first time. At the time, Glencairn was getting ready to buy Sullivan-owned KOKH in Oklahoma City, where Sinclair already owned KOCB. When the FCC relaxed its rules, Sinclair simply replaced Glencairn as the buyer for KOKH. Glencairn then announced plans to sell five of its stations to Sinclair outright.
This move led Jesse Jackson and others to file challenges to the proposed transactions. In the course of subsequent hearings, it emerged that Edwards did not know how much debt Glencairn would assume when the deals closed. This led FCC Commissioner Michael Copps to question the deal's integrity, as well as Glencairn's decision-making process. It later emerged that Glencairn was to be paid for the proposed purchases with Sinclair stock, and that the Smiths controlled almost all of Glencairn's stock. Eventually, the FCC slapped Sinclair with a $40,000 fine for illegally controlling Glencairn. However, it took no further action, leading Copps to blast the decision as a backhanded endorsement of Sinclair's tactics.
In 2001, Glencairn tried to merge with Sinclair outright. However, the FCC rejected the deal because six of Glencairn's stations--WNUV, WVAH, WTTE, WBSC, WRGT-TV in Dayton, Ohio and WTAT-TV in Charleston, South Carolina were located in markets where Sinclair could not legally have duopolies. The reasons stated:
Sinclair, however, was able to buy five of Glencairn's stations, and Glencairn subsequently changed its name to Cunningham Broadcasting. However, nearly all of Cunningham's stock is owned by trusts in the name of the children of the Smith brothers, so Sinclair still effectively owns Cunningham. This situation led Sinclair Media Watch, a grassroots organization based in Asheville, to file informal objections when WLOS and WBSC's licenses came up for renewal in 2004. However, the FCC has taken no further action against Sinclair or Cunningham.