CBS v. Howard Stern

Cite this Article
Bill Sjostrom, CBS v. Howard Stern, Truth on the Market (March 01, 2006),

Today’s NYT has an article on CBS’s suit against Howard Stern for breach of contract (click here). According to the article:

The lawsuit, which also names Sirius and Stern’s agent as defendants, claims Stern improperly used CBS radio’s air time to promote his new show with Sirius, which began last month. CBS also claims Stern discussed his plans with Sirius without disclosing them to CBS as required under his contract.

As for remedies, it looks like CBS is seeking restitution:

CBS wants Stern, his agent, Don Buchwald, and Sirius to return any financial benefits they received from using CBS radio’s air time to promote Sirius, including the value of a tranche of Sirius shares that Stern and Buchwald received early for exceeding a target for subscriber increases by the end of 2005.

It seems to me CBS will have difficulty proving with the requisite reasonable certainy the value of any benefits other than the market value of the air time allegedly improperly used by Stern.

Regardless, Stern is telegraphing a waiver of breach defense:

Stern said CBS officials knew of his plans to leave for Sirius and also condoned his references to satellite radio on the air and did nothing to stop him when he spoke about it on his show.

Update:  This Bainbridge post links to his TCS where he provides more details and legal analysis on the case.