TRN Companies and Cumulus Media have agreed to settle outstanding claims arising during previous ownership of Westwood One, acquired by Cumulus Media in December, 2013. TRN had sued Westwood One predecessor Dial Global over unpaid ad revenues and unfair competition. The settlement’s terms were undisclosed.
Lew Dickey, President and CEO of Cumulus Media, said: “While Cumulus Media had no role in the lawsuits filed by TRN Companies, we are pleased to resolve these claims and move forward together. We remain supportive of each other and are optimistic for the future.”
Mark Masters, CEO of TRN Companies, said: “We are pleased to ‘turn the page’ with the new owners of Westwood One and have put past issues behind us. As we build bridges together, we look forward to a mutually beneficial future working with our affiliated stations, customers, Lew and John Dickey and Cumulus Media.”
Talk Radio Network filed a Federal action against its former ad sales rep Dial Global and multiple other parties 8/27/12, asserting antitrust, anti-monopoly and other claims. There was a mid-November pre-trial conference discussing settlement options, exploring motions, arranging a plan for discovery and setting a trial date. A 4/2/14 hearing had been set to consider the defendants’ (Dial Global, Compass Media Networks, WYD Media Management) motions filed to dismiss and strike the suit out of existence.
The original complaint (which demanded a jury trial), “Complaint for Violations of the Sherman Act and the Cartwright Act, and for Fraudulent Inducement, Interference with Contract and Interference with Prospective advantage,” named: Dial Global, Excelsior Radio Networks, Triton Radio Networks, Triton Media Group, Oaktree Capital Management, Verge Media Companies, Courtside, LLC, Compass Media Networks, Compass Media Marketing, WYD Media Management (Ron Hartenbaum), Spencer Brown, Ken Williams, David Landau (of DG, all since departed from the company), Norm Pattiz (of Courtside), Peter Kosann (of Compass) and Ron Hartenbaum personally.
Courtside and Norm Pattiz were subsequently dismissed from the suit.
Mark Masters blamed TRN’s financial problems on Dial Global and had said that info gathered from the discovery process in the suit would help him stop Cumulus’ buy of WestwoodOne/DG.
RBR-TVBR observation: From what we’ve heard, this is a universal settlement between TRN and DG, Compass and WYD. It’s comprehensive and includes settling outstanding bills TRN owed DG for satellite time. It was funded through a special litigation escrow provided by the sellers of DG. As part of the deal, Westwood will rep TRN’s inventory. We’ve heard relations between TRN and WWO/Cumulus are positive and they both look forward to being able to focus on business, not litigation. It’s a good outcome. Only a rumor, but we heard Masters got $750K cash in the settlement.
Speaking of cash, remember, TRN also may owe Michael Savage a lot of money, but that is still pending. Savage sued TRN in December 2010 regarding his contract, alleging the network used “illegal and unenforceable contract provisions” and “other strong-armed tactics” to intimidate him and force him into accepting a “sub-standard agreement.” The federal case was referred to arbitration. Savage won there and was awarded money damages by the arbitration panel, plus all other money from withheld earnings and permanent ownership of all his archived radio shows. It was upheld in the Federal District Court by Judge Gonzalez-Rogers, appointed by President Barack Obama. It has so far not been paid to Savage. However, the reason why is this is all still under appeal with the 9th Circuit Court of Appeals and Masters has his own monetary claims against Savage.
Cumulus inherited this problem and funded the project from an escrow of money held back in the event of litigation, thus costing Cumulus nothing. Masters suit was not against Cumulus, who had done nothing in this matter other than buy the company, which had this associated problem. The relationship between the two is positive. This allows Masters to return to his previous rep relationship, which brings income to this division of his company, allows Dickey to remove the cloud of litigation, which went deep. Many parties and many lawsuits involving former executives had to be removed to make this work. The media had somewhat demonized Masters for the suit, however in the end Masters was the victor over the former Westwood and Dial Global team, and Dickey is able to start with a clean slate.