Uncensored TV Project Seen as Idea Whose Time Was Stolen
By AMANDA BRONSTAD
A fledgling Beverly Hills production company has sued Universal Music Group Inc. and DirecTV Inc., alleging they stole its idea for an uncensored music video channel.
Uncensored Music Network Inc., formed in August 2003, is seeking $49.7 million in lost investments, plus $10 million per month in lost revenue since an article outlining plans for the channel, dubbed 1 AM, appeared at the beginning of the year.
The Jan. 2 story in the Los Angeles Times quoted unnamed sources as saying that Universal Music Group was in discussions with DirecTV for a channel featuring commercial-free, uncensored music videos. The 1 AM channel, named for the First Amendment, will team Universal, the Endeavor Agency, Van Nuys-based adult entertainment giant Vivid Entertainment Group and rap star Eminem's Shady Records, the Times reported.
"We started getting calls from people who were potential investors saying, 'What's this?' or 'Are they doing the same thing?'" said Karin Richmond, president of UMN. "They took a step back."
Richmond co-founded UMN with Rodney Kimbrew, its chief executive. They are also the co-founders of Poly Pacific Entertainment Corp., which produces soundtracks, television shows and movies, Richmond said.
UMN planned to launch its channel on July 4 and had "recommendations" from Clear Channel Communications Inc. and the American Society of Composers, Authors & Publishers, according to the suit filed in L.A. Superior Court.
Unlike Viacom Inc.-owned MTV, an advertising-supported cable channel that edits videos it airs, both 1 AM and UMN's proposed network would be offered as premium channels that would be free to broadcast more "R-rated" material.
Richmond said that despite the prospect of competition from another "uncensored" video channel, she and Clear Channel were still discussing the nature of its support.
"They're not financially backing us," she said. "It just means they'll do everything they can to launch. They see the value in the network."
She said she was surprised by Clear Channel's ongoing interest in the project given its recent stance on what the company has referred to as "the rising tide of indecency on the airwaves."
Last month, San Antonio-based Clear Channel, the nation's largest radio company with about 1,200 stations, fired Florida on-air personality Bubba the Love Sponge and pulled shock jock Howard Stern off the air in half a dozen major markets. In announcing the termination of Stern's contract on Feb. 25, Clear Channel Radio's chief operating officer, John Hogan, said the show was "vulgar, offensive and insulting to anyone with a sense of common decency."
Still, said Richmond, further meetings with Clear Channel officials about the uncensored channel have been scheduled. Officials of Clear Channel did not return calls seeking comment.
In its suit, UMN said both Universal Music and DirecTV had access to its business plan or prospectus.
In court papers, Richmond and Kimbrew allege that Stephen Bauer, who was only identified as a business associate helping them raise the $49.7 million needed for the launch, gave a copy of UMN's private offering memorandum and 48-page business plan to Jimmy Iovine, chairman of Universal's Interscope label. Since then, Richmond said Bauer has not returned her calls.
In addition, on Sept. 9, 2003, while in discussions about the proposed channel, Kimbrew offered the plan to the program acquisition group at DirecTV, the suit says. On Oct. 3, Richmond mailed a copy of the plan to Steve Rifkind, head of Street Records Corp., which is partially owned by Universal Records, a subsidiary of Universal Music Group, the suit says.
The UMN suit was filed March 9 and alleges misappropriation of trade secrets and unfair competition, among other claims. UMN is also seeking an injunction to stop the launch and development of 1 AM.
"We'll still launch, but there's been a delay, and it makes it more difficult," Richmond said.
Spokespersons at Vivendi Universal, parent company of Universal Music Group, and DirecTV, partially owned by News Corp., did not return phone calls.
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