Antitrust Suit to Proceed Against Cemusa

New York Outdoor Vendor Sued by OTR Media

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NEW YORK (AdAge.com) -- A New York State Supreme Court judge has given the go-ahead for an antitrust lawsuit filed by OTR Media Group against Cemusa, a Spanish-owned outdoor advertising company, and New York.

Judge Eileen Rakower rejected a motion from Cemusa to dismiss the lawsuit.

The Manhattan-based outdoor advertising company argues the 20-year, multibillion-dollar franchise the city granted Cemusa to build and sell advertising on city bus shelters, newsstands and public toilets violated antitrust laws. The contract requires Cemusa to pay the city more than $1.3 billion in advertising revenue for the exclusive right to attach outdoor advertising signs.

The lawsuit, which was filed in November, also challenges a local city law that was enacted in 2005 that bans signs with 900 feet and within view of arterial highways or within 200 feet and within view of parks. OTR alleges that the law and will put a choke hold on the market for outdoor advertising signs, increase the value of city-owned signs and raise the price for outdoor advertising in New York.

"I am hopeful that we will prevail and the outdoor advertising industry, advertisers, landlords, unions and small business will be better off as a result," said Ari Noe, chief executive of OTR Media.

While the court has ordered the city to suspend the enforcement of the outdoor advertising law, Cemusa has been allowed to install street furniture across the city since last summer. A trial date hasn't been set.

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Amanda Fung is a reporter at Crain's New York Business.
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