Contending that the future of talk radio may hang in the balance, news and talk syndicator Talk Radio Network is suing Cumulus Media and its affiliates Westwood One and Compass Media, claiming they are conspiring to destroy TRN’s networks by monopolizing syndication, ad rates and employment of advertising reps.
TRN’s lead attorney, famed antitrust lawyer Joseph Alioto, calls the case “among the most egregious examples of anti-competitive abuses that true monopoly power can cause.”
The complaint filed in the U.S. District Court for Oregon claims violations of the Sherman and Clayton Antitrust Acts, and multiple state laws. It seeks, among other remedies, divestment of assets and treble damages.
Mark Masters, the manager and CEO of Talk Radio Network Enterprises LLC summed up the complaint in a statement to WND, contending it has implications for the whole industry
“The Cumulus super-monopoly has attempted, using a variety of methods, to completely destroy the radio networks I’m involved with, as well as many other radio syndicators,” he told WND.
Masters said Cumulus “has such market power that it has the appearance of attempting to destroy the entire talk radio industry – and will succeed if it is not stopped.”
He sees the suit as an effort to protect “the entire talk radio industry from the most dangerous threat talk radio has ever faced since the Fairness Doctrine – Cumulus Media.”
A Westwood One media representative told WND the company would not comment on pending litigation. Cumulus Media did not respond to a request for comment.
TRN brought personalities such as Art Bell and Michael Savage into national prominence. In January, the U.S. Supreme Court denied TRN’s petition for appeal of Savage’s 2010 lawsuit over a contract dispute.
Cumulus Media is the second largest owner and operator of AM and FM radio stations in the United States.
The April 11 lawsuit was brought by TRN and three related parties, America’s Lifestyle Radio Network, America’s Talk Network and Talk Radio Network Entertainment. It claims the defendants monopolized syndication of talk radio shows and the employment of ad reps. TRN charges Cumulus harmed smaller players by “bundling” the syndicated shows with the ads and not accounting for their methods.
TRN is represented by several lawyers, led by well-known antitrust attorney Joseph Alioto and the Alioto Law Firm. Alioto secured the largest antitrust settlement in history in the flat screen TV panel litigation recently concluded in federal court in California.
Alioto said the TRN 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 percent on what should have been paid to them.”
TRN, he said, received as little as one one-hundredth per listener as previously received for the same programming in the years prior to Cumulus’ acquisition of Westwood One.
He said Cumulus/Westwood One “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.”
Alioto argued that in the 18 months prior to its acquisition by Cumulus, Westwood One lost over 90 percent of its shareholder value and now faces delisting.
The lawyer said 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,” Alioto said.
Masters argued in a press statement that unlike television, which is scripted, talk radio “is key to the First Amendment in that it 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,” he said.
In a May 2013 column for the American Spectator, Jeffrey Lord, a CNN commentator and former aide to Jack Kemp and Ronald Reagan, asked whether or not Cumulus’ woes could be explained by “incompetence” or “suicide.” Could they be, Lord asked, a “deliberate attempt to do in talk radio for reasons known only to the Dickeys – (money? other?),” referring to the brothers, Lew and John, who ran Cumulus until last October when drastic performance and revenue declines caused the Cumulus board to force them out.