Sirius XM Files Answer to Stern Lawsuit – Seeks Dismissal With Prejudice
There is new news in the Howard Stern lawsuit against Sirius XM, and it is quite interesting. The company admits that many facts alleged by Stern, Buchwald, and One Twelve media are indeed accurate, and contends that the lawsuit centers on one pivotal issue. That issue is whether XM subscribers should be counted in the numbers tied to the performance section of the contract with The King of all Media. According to Sirius XM that answer is a resounding NO.
The company did pay Stern $25 million, and Buchwald $2.5 million when the merger with XM was completed, a fact that perhaps most investors were not aware of. The crux of this case centers on how the term “Sirius Subscribers” is defined according to the company. It is Sirius XM’s contention that XM subscribers would not be counted under the Sirius umbrella with or without the merger, which we discussed in a previous article.
“Ultimately, what matters is that the unambiguous language of the agreement does not obligate Sirius to pay – or entitle One Twelve and Buchwald to receive – the windfall payment that One Twelve and Buchwald demand. Sirius was obligated to pay performance based compensation only if the number of “Sirius Subscribers” exceeded by certain specified amounts the number of “Sirius Subscribers projected for each year of the term of the agreement – projections based on the anticipated increase of subscribers to the Sirius service and not any merger with XM. Subscribers to the XM service, prior to the merger, were by definition subscribers to the competitors satellite radio service which did not broadcast the Howard Stern Show. The obligation to make one performance based compensation award was triggered under the agreement on December 31, 2006, and Sirius delivered in January 2007 to One Twelve and Buchwald the shares of stock due them. The conditions precedent for other performance based compensation awards were never met in any other years.”
The company agrees with and also contests several points within the lawsuit, but ultimately seeks a dismissal with prejudice. It would appear that both sides are sticking to their guns, and the issue will boil down to who can present the best argument in front of a judge. Settlement is always a possibility, but for the moment we have a duel.
Sirius XM Response (.PDF) SiriusBuzz Has It First!
It would be helpful if we dealt with the facts:
Fact 1: Page 3, Paragraph G: Sirius is seeking dismisal on SUMMARY JUDGMENT WITH PREJUDICE;
Fact 2: Page 13: Sirius is seeking dismissal WITH PREJUDICE AND REQUESTING AWARD OF COSTS AND LEGAL FEES.
Signed:
SRK
Chief Ax-Grinder
If Howard Stern goes on another rant how Megan Fox was an ingrate to Michael Bay, I’ll laugh. At least when she got fired, she didn’t have to squeeze any penny out of her employer. She should hear what the KOAM is saying and actually put a smile on her face, because she has more dignity and maturity than Stern does.
Also, when Howard gets lazy and greedy and puts out an inferior product, bonuses WILL NOT be met. And then he tantrums like a child, gets passive-aggressive and pouts and sulks for years, all at our expense.
At least I beat the rush and paid for a year. 😉
I personally have a self imposed ban on listening to Stern since this lawsuit. He has nerve with money he makes.
As much as I feel betrayed by Stern,it pales in comparison to the betrayal and neglect I feel from the management of Sirius XM. The pitiful way they have treated the subscribers, destroyed the programming,and raised prices is a disgrace. This company has total disregard and total disrespect for their own customers, so it’s very difficult for me to side with them on any issue. They have taken something with unlimited potential, and diluted it down to something very ordinary – a pay version of terrestrial radio basically. The true fans know this is true; they have been complaining for years, to no avail. Sirius XM has decided to cater to the crowd that thinks Ryan Seacrest is cool, and thinks Jessica Simpson is a great vocalist.
they are looking to have the case dismissed with no need to have a trial–Its a suit without merit and they are hoping the courts dismiss—I agree that they were paid based on XM and trying to count subs from XM is weak in terms of their position
I would be interested to know if when Howard negotiated his new contract, that wording was added to reflect the expected confusion related to the new (((SiriusXm))) brand, where distinquishing a Sirius or XM sub will be difficult to ascertain. I wonder also, if (((SiriusXm))) even included new performance based payments in the latest contract. The fact that it has to be litigated tells me that he recieved no such incentives in the new contract. Am I off base?