NEW YORK (CNNfn) -- Rupert Murdoch's Fox News has filed a federal anti-trust lawsuit against Time Warner after the company decided to keep the upstart news channel off its New York City cable system.
The lawsuit, filed Wednesday, names Turner Broadcasting and its chairman, Ted Turner, as defendants. In the lawsuit, Fox is asking the court to block the merger and to award it $1 billion in damages.
Meanwhile, Time Warner Inc. said Wednesday it will proceed with its planned merger with Turner on Thursday without the approval of New York City cable regulators.
Time Warner's decision to not carry the channel on its New York cable system shuts it out of 1.1 million homes. Turner's Cable News Network and competitor MSNBC are carried on the system.
As part of his full-court press against the action, Murdoch has enlisted and received the support of New York Mayor Rudolph Giuliani and the state's governor, George Pataki.
"This is something I would like to see happen," said Giuliani, referring to getting the channel carried in the city. "I'd like to see it flourish, and I certainly would like to see the 1,400 jobs not only preserved but expanded."
At the mayor's urging, the city's franchise review panel is now studying whether Turner's merger means there has been a change of control at the company. The company's cable operating license allows the board to review the permit under those circumstances.
Time Warner maintains the city has no jurisdiction over the matter.
"Any time you have government officials -- city and state officials -- trying to impose program decisions on a cable operator, that's a violation of federal law. If that should be successful, it is a very frightening situation," said Richard Aurelio, president of Time Warner Cable.
Liberty Cable, Time Warner Cable's main competitor in New York City, does carry the Fox News Channel as well as CNN and MSNBC.
Peter Price, president of Liberty Cable, said the battle is so fierce because getting New York viewers to tune in is vital to the success of any television network. (161K WAV) or (161K AIFF)
Time Warner says it will not budge from its position of keeping Fox News off its system.
Right now, the battleground is New York, but the real war is national and global between two huge, aggressive and well-funded adversaries. Both Turner and Murdoch will try to score the most punches in their efforts to hold off competition whenever possible.