Three years ago, Alpha Media was engaged in a bit of a transformation. Its founder, veteran radio station owner Larry Wilson, in July 2018 stepped down as Chairman of the Board of Directors for the Portland, Ore.-based broadcasting company.
While he remained a Board member, the man who succeeded Wilson as Alpha’s President/CEO, Bob Proffitt, was the key decision-maker for a company that in late winter 2016 had grown in size to become the fourth-largest radio company in the U.S.
Also growing was Alpha’s debt, leading it to voluntarily file for Chapter 11 bankruptcy protection in January 2021.
While all appeared to be positive for Alpha, with an emergence from debtor-in-possession status all but certain, Wilson has reemerged with fighting words submitted via a 191-page document with the FCC.
In the filing, made to the attention of the Media Bureau’s Audio Division and his chief, Al Shuldiner, attorneys Mark J. Prak and Patrick Cross of Brooks Pierce lobbed several accusations against Alpha the FCC’s way.
In short, Wilson’s legal counsel take issue with “two private equity funds usurping control of a privately held broadcast licensee from its Board of Directors, running the company into the ground by attempting to cut costs to achieve profitability, and then promoting a prepackaged bankruptcy plan that would erase the obligations owed to secured and unsecured creditors and minority stockholders, while advantaging management and the private equity funds, and swapping out minority stockholders who are domestic U.S. citizens all in favor of proposed foreign-owned lenders and stockholders.”
The emergence plan from debtor-in-possession status, the attorneys add, “is an affront to the Communications Act of 1934, as amended, and to the FCC’s right to expect candor and forthright behavior from its broadcast licensees.”
The document offers up claims from Wilson that his former company mislead the FCC, made decisions minus the necessary board approval and even challenges Alpha’s right to continue as a broadcast licensee.
Why did Wilson’s legal counsel submit the filing with the FCC, and not the U.S. Bankruptcy Court in Richmond, Va., that’s all but sealed Alpha’s emergence from debtor-in-possession status? As part of Alpha’s restructuring and post-bankruptcy plan, it has already made the necessary filings that would “transfer” its stations from debtor-in-possession ownership to a “new” Alpha.
Here, it appears Wilson is seeking the denial of license renewals for four specific stations: KAAN in Bethany, Mo.; KHAR in Anchorage, Alaska; KATE in Albert Lea, Minn.; and KFOR in Lincoln, Neb.
Wilson wants Shuldiner and his team to deny these applications; the other applications are not part of Wilson’s petition.
“This is a significant case,” Prak and Cross conclude. “The Commission must make clear that privately held broadcast licensees are required to comply with corporate governance obligations and may not lie to the Commission about their failure to do so.”
Alpha Media is represented by esteemed Washington, D.C.-based communications law attorney Kathleen Kirby, of Wiley.
The filing includes a declaration from Wilson that offers a synopsis of his storied career. In 1984, he co-founded Citadel Communications, which would grow from an AM/FM combo in Tucson through its 2001 sale to private investment firm Forstmann Little for $2.1 billion; Citadel effectively merged with what is today Cumulus Media.
In 2009, Wilson emerged as a radio station owner anew, with the purchase of CBS Radio’s former Portland, Ore., and combining those assets with former Rose City Radio stations in the Oregon metropolis. This created Alpha Broadcasting.
Three years later, L&L Broadcasting was merged Alpha Broadcasting. That led to Wilson’s transition to board chairman, ceding day-to-day leadership to Proffitt at the age of 66.
Read the entire petition filed at the FCC HERE.
