Taking on the Empire

A local lawsuit against the world's largest radio/concert firm threatens to expose the dark side of the entertainment business.

Like most people in the live-music trade, Doug Kauffman, Jesse Morreale and Chris Swank, the three partners behind the promotion firm Nobody in Particular Presents, are colorful, argumentative, shoot-from-the-lip types. But not these days. Ever since August 6, when NIPP filed a lawsuit in U.S. District Court in Denver against radio-and-promotion powerhouse Clear Channel, they've been restrained and guarded, thoroughly examining every word that springs to mind before letting it out of their mouths.

"We've got to be careful," Morreale explains. "Very careful."

Clear Channel, based in San Antonio, Texas, is plenty big enough to justify such caution. The company and its various subsidiaries own approximately 1,200 radio stations in the United States (and several hundred more overseas). It also holds Premiere Radio Networks, the country's most prominent purveyor of syndicated radio programming (Rush Limbaugh and Dr. Laura Schlessinger head its talent roster); nineteen television stations; over 700,000 billboards and related advertising forums; and Clear Channel Entertainment, a live-event arm (known until July as SFX) that dominates the concert medium from sea to shining sea.

Chris Swank, Doug Kauffman and Jesse Morreale of Nobody in Particular Presents are standing up to Clear Channel.
John Johnston
Chris Swank, Doug Kauffman and Jesse Morreale of Nobody in Particular Presents are standing up to Clear Channel.
Clear Channel's FleetBoston Pavilion is the model for a planned Denver venue whose tent was previously used at Boston's Harborlights Pavilion.
Clear Channel's FleetBoston Pavilion is the model for a planned Denver venue whose tent was previously used at Boston's Harborlights Pavilion.

But mere size, unprecedented though it might be, doesn't fully explain the fear Clear Channel engenders among inhabitants of the radio-and-promotion universe. The company has also earned a reputation for ruthlessness and ethically debatable activities that raise eyebrows, and hackles, even among industry veterans who thought they'd seen it all.

As reported by Salon.com, a muckraking Web publication that's posted numerous Clear Channel exposés, several suits have been filed against Clear Channel stations by former employees in Florida, citing allegations ranging from broken contracts to sexual harassment. But before now, no one had accused the company of violating monopoly and/or anti-trust statutes -- and the men of Nobody in Particular Presents, a firm whose modesty was until recently underscored by the decision to spell its name entirely in lowercase letters, think it's about time an injured party did.

"Somebody has to take them on, and it might as well be us," says NIPP founder Kauffman. "This company's always fought the good fight; it's epitomized independence and the entrepreneurial spirit, and we feel we have the right to do business without unfair interference. This is America, is it not?"

NIPP's suit asks for damages and injunctive relief "arising out of unlawful and anti-competitive practices" that have prevented "NIPP and others from competing to offer concert promotion services in Denver" and elsewhere. According to the suit, "Clear Channel has built a monopolistic, multimedia empire that is severely harming NIPP's ability to compete, decreasing overall competition and resulting in higher prices and fewer offerings for consumers."

Other charges contained in the suit:

• Artists or bands are coerced into signing up with Clear Channel via an assortment of heavy-handed tactics, including the "nationwide practice of threatening to deny and in fact denying critical airplay and other on-air promotional support."

• By guaranteeing some artists "more than 100 percent of gross sales to promote their concerts," Clear Channel makes it impossible for challengers to bid on important shows.

• When NIPP has tried to promote its events on Clear Channel signals, station representatives have "either limited advertising availability to undesirable timings and placements or eliminated it completely; charged NIPP excessive advertising rates; misrepresented the availability of advertising time (e.g., by telling NIPP that Clear Channel is 'out of inventory' when it actually ran its own advertisements instead); intentionally excluded artists promoted by NIPP from their 'concert calendars'...; and eliminated miscellaneous promotions (such as ticket giveaway contests) for artists promoted by NIPP."

The complaint is wide-ranging and thorough, as would be expected from the legal talent behind it -- namely, Davis, Graham & Stubbs, a grade-A firm, and flashy defense attorney Walter Gerash. Firms like this don't come cheap, and while NIPP has some notable assets (the company controls lease rights on two local theaters, the Ogden and the Bluebird), it's unlikely to be listed in the Fortune 500, or even the Fortune 5,000, anytime soon. Consequently, observers have speculated that NIPP is receiving financial assistance from another source, but Kauffman denies this. "Nobody's involved except us," he says.

Neither Kauffman nor Morreale will discuss the evidence they've accumulated to support their claims, preferring to unveil it only if the case reaches the discovery phase. (By agreement with NIPP's legal team, lawyers for Jones Day, the massive Washington, D.C., firm representing Clear Channel, have sixty days from the date of filing to respond to the suit's allegations. Discovery technically can begin shortly after that point but is apt to be held up by legal maneuvering.)

Pam Taylor, official spokeswoman for Clear Channel, isn't one for spilling beans, either. She says only, "We haven't done anything wrong, and we'll vigorously defend ourselves in court. We compete hard, but we compete fairly. I'm sorry that this had to go to court, because we'd rather fight this out in the marketplace, where it belongs."

And supervisors at Clear Channel's Denver branch are even more closemouthed. Chuck Morris, head of Clear Channel's concert enterprises in Denver, wouldn't discuss the suit. Mike O'Connor, director of FM programming and program director of alternative-rock outlet KTCL, a defendant in the suit along with four FM sister stations, adult-rocking KBCO, hard-rocking KBPI, classic-rocking KRFX (the Fox) and contemporary-hit-radio supplier KFMD (KISS), says only, "I'm not going to comment on it other than to say there's nothing to it, and I'm just going to let our lawyers deal with it." KBPI program director Bob Richards and vice president and general manager Don Howe didn't return phone calls.

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