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Clear Channel fires back with $3M countersuit against Infinity and Stern
The best defense is a strong offense, so Clear Channel is going on the offensive in its legal battle with Viacom's Infinity over Clear Channel bouncing "The Howard Stern Show" from six of its stations. Infinity and Stern sued Clear Channel for $10 million (7/1/04 TVBR Daily Epaper #128), so Clear Channel has fired back by countersuing for $3 million, claiming that it was really Infinity and Stern who breached their contracts by refusing to make the Stern show comply with federal law and FCC regulations.
"The radio show was pulled because Mr. Stern and Infinity refused to assure us that future programs would conform to the law," said Andy Levin, Clear Channel's Chief Legal Officer, in announcing the countersuit. "That was a key term in the agreement, and we gave them every opportunity to make good on their word before we permanently retired the show."
Where does Clear Channel get the $3 million figure? It is seeking damages for lost ad revenues, a refund of what it paid Infinity while the Stern show was suspended by Clear Channel (before the show was officially cancelled and Clear Channel quit paying, leading to the Infinity lawsuit), and to get back the $495,000 in indecency fines that Clear Channel paid the FCC related to Stern's show - - part of a massive $1.75 million settlement with the Commission (6/10/04 TVBR Daily Epaper #113).
According to Clear Channel's countersuit, Infinity repudiated its license agreement with the six Clear Channel stations to air Stern's show because Infinity refused to provide assurances that the show would comply with the government's laws and regulations. Thus, Clear Channel claims, it had no choice but to cancel the Stern show and protect its station licenses.
TVBR observation:
We note that one of the allegations that Clear Channel denies in its response to the Infinity lawsuit is the claim that Clear Channel's suspension of Stern's show was politically motivated - - coming a day before Clear Channel Radio CEO John Hogan was due to testify on Capitol Hill about indecency penalties (2/26/04 TVBR Daily Epaper #39). But we all know this is more about politics than anything else. Viacom/Infinity has decided to stand up and fight the FCC over its erratic and unpredictable enforcement of the indecency statute, while Clear Channel has decided to roll-over and do whatever it takes to make peace with the FCC. But, of course, Clear Channel also doesn't want to pay Infinity any more money than it has to, so this lawsuit and countersuit will likely drag on in the courts for years to come.
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