A “very disappointed” Seven Network has rejected a finding by the Australian TV watchdog that its Sunrise breakfast show breached the television code of practice.

Fighting his corner, the network’s director of news and public affairs, Craig McPherson, blamed the decision on political correctness and “censorship”.

He said Seven would seek a judicial appeal on the “direct assault on the workings of an independent media”.

The trigger for the stoush between Seven and the TV watchdog was a controversial ‘Hot Topics’ segment on Sunrise on March 13, which led to protests from the indigenous communities.

An investigation by the Australian Communications and Media Authority found the segment – hosted by Sunrise’s Samantha Armytage with commentators Prue MacSween and Ben Davis – “provoked serious contempt on the basis of race”.

The segment included comments by Ms MacSween that the stolen generations policy removed children for their own wellbeing and “we need to do [it] again, perhaps.”

Seven’s defence was the segment was based on a story and comments that day in the Courier Mail.

The ACMA ruled the network should have taken steps to verify it before using it for a panel discussion.

In a finding released on Tuesday morning, the ACMA said while “it may not have been Seven’s intention”, the Sunrise segment “included sweeping references to a ‘generation’ of young indigenous children” being abused.

“By implication the segment conveyed that children left in indigenous families would be abused and neglected” while those in non-indigenous families would not.

The watchdog’s chair, Nerida O’Loughlin, said broadcasters could discuss “extremely sensitive” topics such as child abuse in indigenous communities but had to exercise “great care to ensure compliance” with the code.

The ACMA considers that the high threshold for this breach finding was met, given the strong negative generalisations about Indigenous people as a group.”

Mr McPherson did not say whether Seven tried to verify the comments that its Sunrise discussion was based on.

The ACMA found that a “detailed follow-up segment” on Sunrise on March 20 was a more informed discussion but did not correct the first segment “in an appropriate manner.”

This morning we held a special edition of Hot Topics, taking a closer look at the issue of child protection, particularly in Indigenous communities.

Three panellists who are experts in their field joined us to discuss. pic.twitter.com/PPnKJbZV9Q

— Sunrise (@sunriseon7) March 19, 2018

The ACMA, which does not find a breach if a broadcaster makes a timely correction, has no power to compel Seven to apologise.

“Often they end up with pathetic little things like ‘We’re going to train staff’ or take something off a website,” a TV industry expert told The New Daily.

The most effective measure of keeping a broadcaster in line is “the court of public opinion”, said the expert.

“This is very bad publicity for Seven and sometimes advertisers withdraw. Their brand definitely gets slammed so they take it super seriously and are quite litigious.”

In the current case, “It strikes me that it is an internal Seven issue where they need to be able to prep up their panelists a bit more”, said the expert.

“I understand they want people who are going to express an opinion, no problems there, but get your facts right. ”

Former journalist Ms MacSween has reportedly not appeared on the show since the ill-fated segment.

Sunrise uses commentators booked on a roster who respond to same-day stories and issues, “so there isn’t always a chance to necessarily tailor the commentator to the particular topic”, a second TV source told The New Daily.