Antitrust Action Filed Against Cumulus, Westwood One and Others
Cumulus Media and Westwood One are among the defendants named in a complaint filed in the United States District Court for Oregon, brought by four companies engaged in the production and national syndication of news and talk radio programming. The suit claims violations of the Sherman and Clayton Antitrust Acts, and multiple state law violations, and seeks divestment of assets, treble damages and other remedies.
The plaintiffs are represented in the action by multiple attorneys, including Joseph Alioto, one of the preeminent antitrust attorneys in the United States, and the Alioto Law Firm, as lead attorneys. Mr. Alioto recently secured the largest antitrust settlement in history in the flat screen tv panel litigation recently concluded in the United States Northern District of California, and currently serves as lead counsel in an action against one of the largest proposed mergers in history, between the largest producers and distributors of beer in the United States.
Asked for comment on the case, Mr. Alioto stated:
“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).”
“By paying as little as one one-hundredth of what my clients were previously paid for the same programming in the years prior to Cumulus’ acquisition of Westwood One, the Cumulus/Westwood One monopolies’ combined market power is not only devastating my clients, but the entire spectrum of independent spoken word national programming content producers in the United States.”
“This monopoly abuse is so serious that it threatens to destroy the entire spoken word industry, for syndication, nationwide. Cumulus’ management and Westwood One’s management have functioned by simply substituting illegal and unethical behaviors for sound competent business practices and industry expertise. I will simply note two key points to illustrate this. In the 18 months prior to its acquisition by Cumulus, Westwood One lost over 90% of its shareholder value and faced delisting. Now the giant Cumulus Media itself has also lost approximately 90% of its share value, and is soon to be delisted.”
“It is imperative that the antitrust laws be enforced to stop such egregious monopoly behavior, so close to the First Amendment, which is so vital to the marketplace of ideas, and simultaneously save this industry that is so key to consumers, by breaking up the Cumulus monopoly as quickly as possible. In the process, our victory will be a victory for not only my clients, but all independent syndicators, citizens, Cumulus shareholders and Cumulus debt holders as well.”
“Advertising is the life blood of talk radio, and advertising restraints are a direct assault to snuff out competitive ideas. Favoritism towards affiliates and discrimination towards independents is anathema to the free enterprise system and challenges not only small businesses but ideas.”
“Mark Masters, the Manager and Chief Executive Officer of Talk Radio Network Enterprises, LLC, the lead Plaintiff, added that: “Unlike Television (which is scripted by nature),Talk Radio is key to the first amendment in that it’s allows for the open expression of differing political views in radio, by callers and hosts. These unique freedoms that exist within talk radio must not be controlled by a select group.”
Jeffrey Lord (CNN commentator and former aide to Jack Kemp and Ronald Reagan) asks whether or not Cumulus’ woes can be explained by “incompetence” or “suicide”. Read his column in the American Spectator.
About The Author:
Founded in 1993, the Talk Radio Network companies are a juggernaut in long-form talk syndication, eclipsing all other syndicators in the launch and development of successful long-form syndicated radio talk programs.