Spanish Broadcasting System Wednesday announced that it is seeking $1.5 billion in actual and compensatory damages from radio giant Clear Channel Communications Inc., which the Spanish-language broadcaster has accused of
interfering with its public offering in 1999 and with some sales relationships.
In a supplemental filing to a lawsuit
filed in June, SBS charged that the country's largest station group
scuttled negotiations that could have led to a merger between it and Hispanic Broadcasting Corp.
Instead, HBC was "required" to enter a merger agreement with
Univision Communications Inc.
The supplemental filing also appeared to be an attempt to tar Clear Channel's
auditor by stating that HBC -- which allegedly used the same outside auditor
as Clear Channel -- has not complied with new accounting rules by writing goodwill
acquired from previous mergers off HBC's books.
Goodwill is the difference between the price paid for a company and the
actual value of its assets. Charging off goodwill can significantly reduce a
The latest filing also accused Clear Channel employees of defacing SBS property by spray-painting obscene and pornographic messages on the
facilities of KPTI-FM Oakland, Calif.
High-profile lawyer David Boies is representing SBS in the suit.
Clear Channel officials would not comment on the latest allegations but announced
that they hired trial attorney Steve Susman to defend the company.
"This has to be the most shameless publicity stunt I've ever seen," Susman
said in a prepared statement. "SBS is nothing more than a sore loser in its
competition with HBC over the years in the Spanish-language radio market."
Last month, Clear Channel chief executive Lowry Mays called the original
charges "frivolous" and pledged to "fight vehemently to defend our position."
Last week, Clear Channel announced that it would replace radio-group head Randy Michaels and denied rumors that the company would be the latest
corporation caught in the wake of accounting scandals.
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