Howard Stern sues Sirius XM, which airs his radio show, over stock
Howard Stern has sued Sirius XM satellite radio, which has aired his hit show since he left terrestrial radio in 2006, for allegedly refusing to give him stock options he says he was promised.
In the complaint, filed in New York on Tuesday, March 22, the shock jock says that when he agreed to move his radio show to the satellite radio firm in 2004, it promised to pay his production company, One Twelve, a series of escalating stock awards if Sirius XM, then known as Sirius, "exceeded its subscriber estimates in any year of Stern's contract by two million or more subscribers.
Stern also says that his agent, Don Buchwald, was promised a consulting fee equal to 10 percent of One Twelve's compensation. The radio host says that he brought in more than two million subscribers in 2006 and 2007 and that the number of internal subscribers grew to 20 million in 2010, two years after Sirius acquired competitor XM.
Sirius XM, the lawsuit says, paid One Twelve stock awards only in the first year of Stern's contract and has since refused to pay his company what he says it is owed.
The satellite radio firm said in a statement carried by the Reuters news wire that it had "met all of our obligations under the terms of our 2004 agreement with Howard, his agent and production company" and added it was "surprised and disappointed" by the legal action.
"I'm an honest guy who believes in fairness," Stern said on his radio show on Tuesday. "And so I believe I've been dealt with unfairly. And so that's a lawsuit. And it causes me great pain to sue the company I work for. And obviously it's not very comfortable. But nevertheless, I had to do it...I've never asked for anything that isn't mine."
In December, Stern signed a new 5-year deal with Sirius XM, which agreed to continue to broadcast his show and other programs on his Howard 100 and Howard 101 channels until the end of 2015.
Stern's show features longtime sidekick Robin Quivers and regular commentators Baba Booey and Bubba the Love Sponge. It is known for its explicit content, swearing and interviews with major international celebrities as well as porn stars.
Investors had been concerned that the network's subscribers would abandon the radio service if Stern left. The company's shares rose more than 6 percent following news of Stern's new deal. Sirius XM CEO Mel Karmazin said the agreement was "good for SIRIUS XM and good for Sirius XM stockholders."
Stern has been a radio host since the 1970s and his show has aired on television. He moved to satellite radio in 2006 following a dispute with terrestrial radio stations that had carried his syndicated show over alleged indecent programming, which led to Federal Communications Commission fines of $2.5 million.
Moments from his career and beef with the FCC and his then-boss were showcased in the 1997 comedy film "Private Parts".
Stern has not disclosed his new salary that was promised in his new deal. His previous 5-year agreement had promised him $500 million.