Shock jock claims Radio company failed to pay stock awards
Responding to Howard Stern’s lawsuit, Sirius XM said Tuesday that it’s “surprised and disappointed” that the shock jock brought legal action against the company for what he claims are unpaid bonuses.“Sirius XM just signed a contract through 2015 with Howard Stern, and he is a valued part of our company,” Sirius XM said in an emailed statement. “We have met all of our obligations under the terms of our 2004 agreement withHoward, his agent and production company.” Docs filed on behalf of Stern, his agent Don Buchwald and Stern’s production shingle, One Twelve Inc., claim that the satcaster failed to pay stock awards to Stern over the past several years. According to the suit, “The Howard Stern Show” helped add 2 million Sirius subscribers annually, triggering stock bonuses at each threshold. At the end of 2003, Sirius claimed about 230,000 subscribers compared to XM’s 1.3 million. The self-proclaimed “King of All Media” is widely credited with helping to boost Sirius XM’s number up to 20 million as of December. Stern, Buchwald and One Twelve Inc. say an initial bonus was paid in 2006 but that no other payments were made during the following years. “When Sirius needed Stern, it promised him a share in any success that the company achieved,” the suit states. “But now that Sirius has conquered its chief competitor and acquired more than 20 million subscribers, it has reneged on its commitment to Stern, unilaterally deciding that it has paid him enough.” Suit also credits Stern’s show with increasing Sirius’ ability to purchase XM Satellite Radio in 2008. Stern, who accrued numerous FCC violations during his tenure on terrestrial radio, first signed on with uncensored Sirius in 2004. Last year, Sirius and Stern spatted publicly over contract renewal at the tail end of his $500 million, five-year agreement. In December, he announced a new deal extending through 2015. While the terms of the deal weren’t disclosed, some analysts suggested then that while Stern’s take-home pay probably remained intact, he may have received fewer or no stock options (Variety, Dec. 9). “Howard forever changed radio and was instrumental in putting Sirius on the map when he first launched on satellite radio,” said Sirius XM CEO Mel Karmazin at the time.