New York State attorney general Eliot Spitzer is bringing a lawsuit against Entercom Communications, accusing the radio company of illegally trading airtime for payments.

New York State attorney general Eliot Spitzer is bringing a lawsuit against Entercom Communications, accusing the radio company of illegally trading airtime for payments.

In the latest twist of a lengthy, high profile payola probe that has already derived multi-million dollar settlements from two of the world’s four largest record companies, Spitzer charges Entercom with “accepting secret payments in exchange for airtime,” compromising its programming and violating state and federal laws.

"What makes this case especially egregious is the extent to which senior management viewed control of the airways as an opportunity to garner illegal payments from record labels,” Spitzer said in a press release announcing the suit.

Entercom officials were not immediately available for comment.

Spitzer alleges that Entercom, radio’s fourth largest group with 105 stations, traded airtime for gifts, promotional items, personal trips and other gifts. Entercom “solicited” such payments from labels, Spitzer claims, and instituted corporate programs, supported and directed by senior management that sold airtime to record labels to manipulate music airplay charts.

While Entercom is the first and only radio company to be sued by Spitzer for alleged payola, other companies openly engaged in paid spin programs like the one cited in his suit. The programs involved selling overnight spins to labels and disclosing the arrangement on the air. Because the quid-pro-quo was disclosed, such paid spin programs have not run afoul of the federal payola statute.

The suit claims Entercom executives were closely involved in the activities, and cites e-mails and other documents where company executives discussed strategies for augmenting station budgets with payments from independent promoters and record companies.

Eight months after extracting his first major label payola settlement, the crusading attorney general has also cranked up the volume on his call for the FCC to act on payola. “The agency's inaction is especially disappointing given the pervasive nature of this problem and its corrosive impact on the entertainment industry,” Spitzer said.