Ed Stolz’s FMs Head Into Receivership, Under Patrick

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Ed Stolz is widely known across the radio industry as the man who tried, and repeatedly failed, to negate the sale of what today is KUDL-FM “106.5 The End” in Sacramento to Entercom Communications for $25 million.


Now, he’s making headlines for another loss — this time, of ownership of all of his remaining FM radio stations.

Riverside, Calif.-based California Central District Federal Judge Jesus G. Bernal on July 6 signed off on the appointment of Larry Patrick, Managing Partner of Patrick Communications, as the receiver of three radio stations owned by Stolz through three licensees.

They are Major Market Radio LLC’s KRCK-FM 97.7 in Palm Springs, Calif., a Class A with a signal best-heard over Indio and the eastern Coachella Valley; Golden State Broadcasting’s Class A KREV-FM 92.7 in Alameda, Calif., with coverage of the city of San Francisco and Oakland; and Silver State Broadcasting LLC’s Class C KFRH-FM 104.3 in North Las Vegas, Nev.

All three stations air a Top 40 music format.

How did Patrick Communications last week quietly gain control of the three stations?

It has nothing to do with Stolz’s quixotic quest to regain ownership of KUDL-FM. Rather, it is tied to a lawsuit alleging copyright infringement by 17 individual holders — led by WB Music Corp.

That lawsuit, in July 2018, saw Judge Bernal declare that Royce, and Stolz as its principal owner, must pay upward of $1.5 million in license fees, costs, attorneys’ fees and statutory damages to the American Society of Composers, Authors and Publishers (ASCAP) and its members.

Why? Royce International’s three stations failed to pay ASCAP license fees “over several years” and continued to broadcast songs written and published by the group’s members without permission.

Fast-forward two years, and the 17 copyright holders haven’t received a cent from Stolz. With reported debts of the three stations more than $2 million, and the music publishers still awaiting the court-ordered payments, Bernal moved ahead with stripping him of ownership.

An application to transfer the broadcast licenses of KREV, KFRH, and KRCK from the three licensees to Larry Patrick will be filed shortly.

Yet, Patrick already has the power to manage and the authority to take charge of the assets, including all business affairs. Patrick can also move ahead to hire and fire, as he sees fit, at each of the three FMs.

The July 6 ruling from Judge Bernal also allows Patrick Communications to conduct an independent analysis of Royce International’s financial statements and affairs, and to start shopping the three stations around to potential buyers.

What was required of Patrick upon his appointment as receiver of the stations? He must report to the court on a monthly basis, and post a $10,000 bond by Wednesday, if Patrick has not already done so as of this writing.

As receiver, he will also have the right to receive fees of $7,500 per month “plus reasonable travel expenses,” to be deducted from the gross receivables of the respective stations.

Patrick’s broker commission is also spelled out by Judge Bernal: He’ll get 5% of the first $3 million and 2% on consideration paid above the $3 million value.

As such, Patrick stands to earn at minimum $450,000 with a sale that could generate significant interest, in particular for the San Francisco-Oakland FM. Despite its limited signal compared to other FMs in the market, KREV-FM has coverage of the most populated urbanized areas of the metropolitan area. Then, there is KFRH, a big-signal FM in a market with long-term growth, even as COVID-19 pandemic worries have crippled the casino resort economy.

While the order from Bernal came July 6, a proposal to appoint Patrick as receiver was made by the music publishers on February 10.

KRCK-FM has been owned by Stolz since its sign-on. That had its own controversy, as CBS Radio accused Royce of violating copyright infringement law by deciding to call his new FM “K-Rock”; CBS at the time owned KROQ-FM in Los Angeles. Today, KRCK-FM boasts an HD2 signal airing a Talk format, and programming is simulcast at 98.1 MHz via K251BX.

Ownership of KREV came in 2009, as Royce acquired the property formerly known as KNGY-FM from Flying Bear Media for $6.5 million.

In Las Vegas, a 2009 transaction yielded Royce the former KCYE-FM — and, before that, KJUL-FM — in an arrangement that gave Beasley Media Group the facility at 102.7 MHz that had been KFRH and is now “Coyote Country.”

With the three FMs now in Patrick’s hands, Royce now owns but one property: Talk KBET-AM 790 in Las Vegas. The station was not put into receivership likely because it does not play music.

The loss of KFRH, KREV and KRCK culminates more than two decades worth of struggles as a broadcaster for Stolz. They began in September 1999, some 3 1/2 years after Royce International agreed to sell Class B 50kw Alternative KWOD-FM 106.5 in Sacramento for $25 million.

Stolz attempted to reverse the license transfer as he sued Entercom’s now-President/CEO, David Field, alleging violations of the Racketeer Influenced and Corrupt Organization Act (RICO).

The battle was won by Entercom, in California Superior Court, but Stolz fought on, with his most recent attempt to negate the transaction coming in July 2019.

— Archival reporting by Carl Marcucci.