As has been rumored, CBS Radio has filed suit against Howard Stern, his company One Twelve, Inc., his agent Don Buchwald, his agent's firm Don Buchwald & Associates, Inc. and Sirius Satellite Radi
As has been rumored, CBS Radio has filed suit against Howard Stern, his company One Twelve, Inc., his agent Don Buchwald, his agent's firm Don Buchwald & Associates, Inc. and Sirius Satellite Radio.
The lawsuit is for compensatory and punitive damages for multiple breaches of contract, fraud, unjust enrichment, and misappropriation of CBS Radio's broadcast time. It further seeks damages from Sirius for unfair competition and tortious interference with Stern's CBS contract.
The complaint was filed in the New York Supreme Court in the county of New York.
Among the charges listed in 43-page document:
* CBS says Stern "repeatedly and willfully breached his written contract over the last 22 months of that contract, misappropriated millions of dollars worth of CBS Radio airtime for his own financial benefit, and fraudulently concealed his interest in hundreds of millions of dollars of Sirius stock while promoting it on the air."
* That on or about Jan. 9, 2006, Sirius paid over 34 million shares of stock, valued at approximately $220 million, to Stern and his agent because Sirius exceeded by the end of 2005 certain subscriber targets that were set in the Sirius-Stern contract. All of Stern's actions for which he received this expedited compensation occurred during the time that Stern was under exclusive contract with CBS Radio, when the Sirius payment terms to Stern were kept secret.
*The Sirius contract, according to CBS, provided “a compelling incentive for Stern to do all that he could to help Sirius reach the subscriber targets by the end of 2005 so that he could receive his Sirius stock payment as soon as possible while Sirius's stock was extremely valuable. By taking action on CBS Radio's airtime in 2004 and 2005, Stern assured himself of immediate access to $200 million in assets that could be readily converted to cash.”
*By using CBS stations to promote Sirius, the company says Stern "misappropriated millions of dollars worth of CBS Radio airtime for his own financial benefit" and the financial benefit of Buchwald and Sirius in contravention of repeated directives by CBS Radio.
*CBS also claims that Stern has not returned recordings of his CBS radio program that under his agreement belong to the company.
The suit further charges that Sirius intentionally interfered with and procured Stern's breach of the agreement, saying that Sirius “induced and caused Stern to breach these contractual provisions by offering to accelerate Stern's payment of millions of dollars in stock options to promote Sirius on CBS airwaves and by concealing Stern's stock interest from CBS Radio.”
Stern addressed many of the charges in a pre-emptive press conference held in Manhattan.