The San Francisco-based attorney representing Talk Radio Network Enterprises on Tuesday sent a brief three-sentence letter to the federal bankruptcy judge who signed off on Cumulus Media‘s Chapter 11 reorganization plan.
What transpired?
RBR+TVBR has learned that the New York-based court has “cancelled the stay.”
On behalf of Oregon-based TRN, attorney Joseph M. Alioto informed Judge Shelley Chapman that he is hereby withdrawing a motion filed June 18 for relief from the automatic stay given to Cumulus as an integral part of the company’s emergence from bankruptcy protection.
Alioto, communicating by text via his San Francisco-based office, explained to RBR+TVBR, “The stay was cancelled by the court. We will proceed with the case.”
Further details were not available at RBR+TVBR’s 4pm Eastern deadline.
A hearing had been scheduled for Monday, July 16 at 10am Eastern by Chapman to determine whether TRN and three other entities could proceed in their request to bring new life to claims against Cumulus and WWO an Oregon federal court dismissed.
TRN and the three other plaintiffs specifically sought the “motion of relief from an automatic stay” in order to move forward with legal action against Cumulus in the Federal appellate court’s Ninth Circuit.
Along with TRN are affiliated enterprises America’s Talk Radio Network, America’s Lifestyle Radio Network and Talk Radio Network Entertainment.
A quick review of procedural history provided to Chapman by Alioto shows that an appeal from the dismissal of TRN’s April 2016 antitrust action was pending in the Ninth Circuit at the time Cumulus filed for Chapter 11 bankruptcy protection.
TRN has been fighting competitors in the courts for years. In 2012, TRN and two other entities filed suit against Dial Global and other media groups in a California Federal district court. “Numerous antitrust and unfair competition violations” were finger-pointed by TRN, along with claims that Dial Global is guilty of breach of contract, fiduciary duty, tortious interference with contract and business relations, and unjust enrichment claims.
The California court transferred the case to New York on a jurisdictional matter in May 2013; a settlement agreement emerged in late February 2014. This included a two-year ad representation agreement. But, that didn’t go so well: TRN through Alioto tells Chapman that after the execution of the agreement for ad representation, “the defendants named in TRN’s complaint engaged in unlawful, wrongful and improper actions, and used their market power in the independent national syndication ad rep market” at the expense of TRN.
Further, TRN says WWO “is able to steer outsized shares of net advertising revenue to itself and other defendants because it fails to disclose the amounts that advertisers paid for each program in a particular bundle; Westwood then either retains the excess for itself or credits the remainder to programs that it or other defendants own, produce, and/or syndicate and that were included in the same advertising bundle; and Westwood has engaged in such actions on an ongoing basis after Feb. 28, 2014.”
After the commencement of the February 2014 ad rep agreement, WWO’s sales representative — according to TRN — transferred his services to an affiliate of one of the other defendants, leaving TRN without a sales representative for its commercial inventory and underperforming sales advertising representative services contracted for under the rep agreement.”
Commencing in October 2015, TRN claims, “WWO failed to pay over those amounts actually due to TRN based upon the sale of TRN’s commercial inventory and has refused to issue the revenue and disbursement reports due to TRN, as required by the ad rep agreement.”
There’s further discussion of “monopoly power” and big guy vs. little guy in the request from Alioto to Chapman, along with an accusation that former Cumulus head Lew Dickey Jr. was involved in “a conspiracy” to prevent TRN from expanding on the news programming of America’s Morning News “and other potential news programming of TRN to limit the ability of TRN to expand its news programming in competition with Westwood.”
New programming was announced by WWO in July 2014, including the purchase of news content from CNN and the substitution of WWO’s own branded news content for that associated with ABC.
Also fingered by TRN: Charles Steinhauer, former Dial Global COO and now COO of Westwood One.
All of this ultimately led TRN to have Alioto bring its complaint against Cumulus and WWO — the April 2016 filing in Oregon.
Alioto said, “This case is among the most egregious examples of anti-competitive abuses that true monopoly power can cause. My clients have been underpaid in some cases by as much as 99% on what should have been paid to them (receiving as little as one one-hundredth per listener as they previously received).”
With Tuesday’s withdrawal of the motion, TRN and Alioto are now expected to renew their efforts in the Ninth Circuit.
