Journalist and attorney Allison Hope Weiner is a special correspondent to Deadline and files this exclusive breaking news:
Now it’s getting personal in Round Two of the legal war between Howard Stern and his satellite radio boss Mel Karmazin according to affidavits filed today by Stern and his longtime agent Don Buchwald, reviewed exclusively by me. Only last January, both Stern and Sirius CEO Mel Karmazin were basking in the glow of Stern’s new contract, with Howard praising how well he’d been treated. But it turns out that, even as Stern was inking the new 5-year pact, the two men were already clashing over Karmazin’s refusal to acknowledge that the company owed Stern additional performance-based stock awards because he exceeded the subscriber targets set in his original agreement with Sirius. Three months later, Stern and Buchwald sued the merged Sirius XM. Now new details keep surfacing about what went wrong between Stern and Karmazin.
In the affidavits, Buchwald reveals that in early 2010, he contacted Sirius about why the performance-based compensation that Sirius then owed Stern for 2008 and 2009 wasn’t paid. “Sirius claimed that no compensation was due,” writes Buchwald. He then had Stern’s lawyer write to Sirius’s General Counsel asking for an explanation. The company again refused to pay. “Sirius’s lawyer claimed that the subscribers on the XM platform did not count toward the total number of Sirius subscribers and pointed out that we had already received the ‘merger bonus’,” writes Buchwald. Finally, during the renegotiation of Stern’s original contract, Buchwald tried again. “I attempted to discuss the performance-based stock awards with Karmazin,” writes Buchwald. “Karmazin, however, refused to discuss any resolution of the matter.”
Buchwald alleges that only when it became clear they weren’t going to “make any progress with Karmazin,” he and Stern decided to bring a lawsuit because Sirius was now trying to renege on the agreement. Buchwald points an accusatory finger at Karmazin in the affidavit. “Sirius’s CEO, Mel Karmazin, was not at Sirius when I negotiated the Agreement with the company. The CEO at the time was Joseph Clayton. Scott Greenstein has told me a number of times that Karmazin is unhappy with the size of the Agreement that was negotiated and agreed to by his predecessor, and that Karmazin has said that if he had been CEO at the time, he would have given Stern much less and not given into our demands. He might have tried to do that, but in this case, as I told Scott Greenstein more than once, Sirius would not have gotten Stern.”
Stern for his part, seems to be taking the lawsuit very personally. “Our Agreement is clear — the stock awards are based upon the total number of subscribers that the company has at the end of any given year,” Howard says in his affidavit. “When we were negotiating the agreement, Don raised with Sirius the possibility that Sirius and XM might combine. Sirius never said that, if that happened, it would not count the new subscribers for purposes of the stock awards.” Stern adds that he fulfilled his role of drastically increasing the subscriber numbers and now deserves to share in the company’s success.
Stern doesn’t specifically single out Karmazin as a target, but it’s clear that his patience is wearing thin. “Last year, Sirius celebrated having more than 20 million subscribers [by] taking out ads in the media and throwing a Paul McCartney concert to commemorate this historic event. I went to that concert, and it was simulcast on one of my channels,” he notes rather pointedly in the final paragraph of his affidavit. “I do not understand how the company can brag to the world that it has more than 20 million subscribers, and then turn around and tell me that only half of them count. All of these subscribers are subscribers of Sirius. Sirius has pointed to them as a measure of the company’s success, and the whole purpose of the performance-based stock awards was to allow me to share in that success.”
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If it weren’t for Stern, Sirius would be a distant memory. And if he left tomorrow, Sirius would collapse. I know Stern isn’t hurting for money, but he still deserves to be paid what he’s owed.
You can not be serious. If it wasn’t for SIRIUSXM STERN would of been removed from radio by now with the huge fines and the FCC going after him. STERN is old and tired news with the same BS game over and over. He did nothing for the PPS when he resigned and it’s now obvious he will bite the hand that feeds him and go down as a greedy SOB.
You cannot be serious. Your tastes do not matter in discussing popularity, and this stinks of a person that never takes the time to research anything. I’m sure you’ll claim otherwise, but look at the ratings for “terrestrial” radio before and after. That alone ends your point. Count how much the fines he received over the entire time accounted for vs. what he made for Infinity Broadcasting. Care to know the amount fined in total? $2.4 million. For 20 years (starting with WXRK) worth of broadcasting. You honestly believe the company spent MORE than that for promotion. It was the cheapest they ever paid for such massive awareness. Did rating decline with fines? Nope, increased. I’d love to see any argument against that. And of course he deserves the money. Sirius is biting the hand that feeds it, your logic is not close to correct. Can you honestly explain that either company would succeed without him? Of course not, it’s ridiculous to think otherwise. They have internal numbers on listeners. Easily available if you look hard enough. Go give it a quick Google search, then come back here and continue your weak argument.
LOOK AT CBS RADIO IT HAS FALLEN APART WITHOUT HOWARD SIRIUS SHOULD PERFORM FELACHIO ON HOWARD EVERYDAY BECAUSE WITH OUT HOWARD WE ALL LEAVE AND SIRUS IS BACK IN THE TOILET
Happy caps lock day.
you’re an idiot, stern is the only radio personality that even matters, douche bag
Yo Scuba,
Stern is certainly an American Icon and now that I don’t hate talk shows… It’s easier for me to say that Stern is the backbone of Sirius.
People should not take Stern’s decision to sue his boss for money owed lightly. If it were you in those shoes… You would do the same. That is fact! Most people would if given the same. GO HOWARD!
Jarcola, you are an idiot. Stern has never sounded better. He is more focused and is much less angry than he ever was on terrestrial radio. Sirius wouldn’t be on the air now without Stern, he saved the company.
Jarcola, you sound like the typical person who has never listened to Howard’s show. Your commenting on something you know nothing about. Like the other comments said, CBS and Clear Channel radio is dead and when Howard retires Sirius will die too.
You’re fucked!
you are an Idiot
I have been a Howard fan since 1986 and he did save Sirius. However I don’t believe the XM subscribers that came over in the merger should count. I know a lot of people (not 10 million) but a lot who subscribed to XM because they didn’t like Stern. The numbers from XM do not indicate that Stern had anything to do with it.
The reason they were able to merge in the first place is because of Stern. Therefore the XM subscribers do count, not that I really care but fair is fair… Pay the Man.
This seems like an easy fix to me. i think at best, Howard can count only those XM subscribers who signed up for the “best of Sirius” package. b/c the merger was not total – if you were an XM subscriber, you don’t get all the Sirius channels. A handful of them (Stern, NFL, etc) were held back and you have to pay extra for the best of package. The reverse is true for Sirius subscribers and a best of Xm package.
now, of course, not all who buy the best of buy it for Stern. but is a more reasonable assumption that those subscribers could be attributed to him, not simply ALL the former XMers.
But, if his deal *was* written in a way that it states (or could be interpreted to read) that he is entitled to count those numbers, Sirius is just SOL.
But i think Mel is Mel. He thinks the previous deal stinks and isn’t going to comply. That is Mel; Howard is pissed b/c Mel being Mel isn’t working for Stern in this instance. Mel will just wait out all legal maneuvers and hope the final one goes in his favor. And what is Stern going to do? he already signed his extension. That was moronic. maybe Stern should be more ticked at himself, and especially his agent.
however, if the contract is ambiguous, and can be reasonably read in two ways, the ambiguity is usually interpreted against the drafter. After all, you wrote it, you should have clearly written what you intended.
It’s very easy to find out how many subs from XM went to hear Howard, just count the sub’s that have the best of Sirius package!
I have been a listener since he came to Ca. I only have Sirius because of him. He deserves what was promised. When he is gone I am gone. Period.
I agree! If it was not for Stern,the companies would never have merged and they both would have folded. Just give him the stock which he is going to sell for the cash anyways! These idiots are going to screw around like CBS did and Stern will leave after this contract if they don’t stop screwing around. Of course,these Satellite people are not all that bright! They got rid of Bubba,and ok he is an acquired taste but still they pay Oprah millions…..WTF? Even if you hate Bubba you can not say Oprah is better on the radio! Just an example of how f’n clueless some of the Satellite Radio guys are! I understand Mel’s position but the agreement was there before he got there…..shame on him if he did not do his homework on what type of deal his number one draw had. Even if Sirius XM does not go out of business when Stern leaves,the longer he stays with the company,the lesser the impact will be when he does eventually leave. At best,Stern would probably sign on for two more 5 year terms each after the current term……BUT…..someone at Sirius needs to fix this mess and start kissing Stern’s ass now! Just give him what he is asking for!
And to Mel……”….I thought I told you not to be stupid you moron!!!!!!!!!!!”
Agreed. Howard Stern made the greatest contribution to Sirius that Sirius could have hoped for, and forced XM to merge with Sirius.
Howard Stern will forever go down in entertianment history as a champion in broadcasting.
However, today I cancelled a Sirius account because all I hear anymore on the Sirius 100 and 101 channels are old re-runs of Stern and shitty programming from hacks.
Stern deserves what he is contracted for. But I dont have to pay for replays and sit thru his entire team taking 1 week off for every holiday, 3 days of work per week and listen to him complain for the 3 days that he is on the air. Thank god I didnt invest in the stock
Stern is a talent but he is the trained monkey and only that. He collects a check like everyone else.. a 500,000 check..
I plan to cancel and so should everyone else..don t be enablers. He is no longer funny but slowing turning into DON IMUS
STERN SHOULD – KISS- KARMAZIN’S ASS FOR THE DEAL HE GOT . I SMELL A SHEEN !!
You “SMELL A SHEEN!!”? What does that mean? Howard Stern is having a drug-fueled psychotic episode because he disagrees with his employer on how much money he deserves to be paid?
CRY…………BABY……….. !!!!!!!!!! ALREADY PAID MORE THEN HE DESERVES ……..
Ah, it’s clear you didn’t read the article. That’s cool, I wouldn’t expect you to read, seeing as you can’t see the little light on the keyboard that alerts one when the “Caps Lock” is on. Interesting.
Sirius was in a position to acquire XM ONLY because of the numbers of subs Howard brought to Sirius. Without Howard, XM would have acquired Sirius, or Sirius would have gone under. it’s that simple.
whenever Stern retires Sirius will diminish greatly if not disappear all together. Stern better collect whatever he can now.
agreeance. If or when Stern leaves Sirius it will instantly become a dinosaur.
“agreeance?” Stern fans…smh.
ditto!
The only reason I have sirius is for Howard. Howard goes, I go. Pay him what he’s owed MEL.
I will cancel my subscription the moment he leaves Sirius.
I agree. I was ready to pull the plug when it sounded like it wasn’t going to be renewed in December.
I did pull the plug in December. They kept offering me deal after deal to stay on. Finally they gave me 3 full months for free since I told them I wouldn’t pay anything if they did not have a Stern contract. I think they were extra generous because they didn’t want to fall under the 20 mil subscribers mark before the big party.
SiriusXM is right on this. Stern didn’t bring in those subscribers, it was the merger. Stern is trying to claim bonuses on something he didn’t earn. Stern shouldn’t win this law suit.
And it’s funny that SiriusXM has to take this, bc they’ll do anything to keep Stern. Even if Stern only works 3 days a week. Hardly worth the price they’re paying.
The deal isn’t that he only gets paid for the subscribers that listen to him. It’s how many total subscriptions there are at the end of the year.
doesn’t matter if it was Howard or the actual merger who brought in those overall numbers. Unless it was stated in the contract that merger numbers don’t count in the overall subscriptions then Stern is owed money.
There would never have been a merger had Stern not been at Sirius. Well Sirius wouldn’t be he “parent” company anyway. Sirius was barely hanging on before Stern and hence, he is the sole reason for the added subscribers benefited from the merger. That said… if my subscription rate goes up again to pay off Stern… bye-bye!
Just a thought Cokelogic – -
Is it not fair to say that Sterns success at Sirius helped the sirius merger to happen and without him, one could argue, that rather than a merger sirius may have simply gone away altogether or been acquired out rite by XM. It could be said that were it not for stern, there wouldnt be new subscribers or sirius would have had a much less favorable deal during the merger and his very presents both saved and made a ton of money for the higher ups and may have potentially saved all their jobs.
I mean one could say that, no?
Im really not smart
presence not presents.
You’re right about the last point.
they couldnt even get the merger if it wasnt for Stern, can you really be so dumb
Exactly! The contract doesn’t rule out subscribers picked up from the merger. But also consider that the merger would never have happened if not for Stern. This is silly. He’s owed the money, pay him!
Stern is a genius and deserves every penny of compensation. He made Sirius and probably sat. radio itself. I don’t understand the haters. He produces more comedy content than anyone in the history of radio, TV, or film. There would be no Sirius without him. Sirius was nothing before he came aboard.
I don’t understand Mel. He’s a smart man, but this is a major fuck up. It’s the message not the medium. It’s the software, the talent that drives every new platform. When Stern left CBS Radio, it died. Just died. They actually thought he was replaceable. He’s not.
Go back to the infancy of TV. What drove the new platform? Your Show of Shows. Before that, nobody gave a shit about that big box with the 5 inch screen. But Uncle Miltie turned on the country.
It’s always the talent and Stern IS the talent. As someone who works in Hollywood, I can tell you that for everyone in this town working in comedy under 50, Stern is THE dominant comedy figure influencing almost every comedy actor, writer, and director working today; and they’ve appeared on the show and SAID IT.
That’s why, despite the Sybian and lesbians a plenty, he gets Oscar winners, showrunners, A list talent and A list directors on his show. He is an entertainment icon; one of the most important media figures of the 20th century.
Mel should fire himself for this colossal act of hubris and stupidity. Kiss his ring, Mel. Pay the man because he IS the man. Nobody gives a shit about sat. radio. They only care about Howard.
He is nothing more then a smut pushing tired over paid Jacka… No one cares about STERN anymore and the only reason they resigned him now is because SIRI finally was recovering. Once his contract is up there will be so much going on on SIRI including all new radio technology STERN wll wish he never did what he did. How much can you listen to the same old cursing, farting, burping and stripper show. Same crap since K-rock. No one cares and no one needs him.
“He is nothing more then a smut pushing tired over paid Jacka… No one cares about STERN anymore and the only reason they resigned him now is because SIRI finally was recovering. Once his contract is up there will be so much going on on SIRI including all new radio technology STERN wll wish he never did what he did. How much can you listen to the same old cursing, farting, burping and stripper show. Same crap since K-rock. No one cares and no one needs him.”
What??!!??
You obviously don’t listen to the show in any capacity to make a statement like that. There is so much more to the show then that. He’s about the only mainstream media outlet telling it like it is. Sure his views and comments can be over the top, but thats the entertainment side of it. The underlying message he speaks is great and it’s too bad more people don’t see things like him and his listeners.
To the people that say he’s not relevant anymore, you’re talking out your butt. More news headlines are generated from his interviews than any other source. Just check TMZ or any of thise sites that cater to celebrity news.
Anyhow, the haters will hate on uneducated information and that will never change. Go listen to rush libaugh then. lol
A-List celebs??? When?Where? Today–the actor who played Mitch’s son on “Baywatch”, and Miss Howard Stern–Andrea Ownby. Monday’s show- Strongest Naked woman Contest.Last week, the biggest star called in–Leslie West.Say what you will about the legal issues, but Stern is a shadow of his former self, as is his show.
Wrong again. The show has never been funnier or better. And as far a guests go, it’s not how big are they, it’s about how interesting they are. Tatum O’neal for an hour – GOLD. Brian from AC/DC – GOLD. and the list goes on.
If you listen to old K-Rock era Stern, it’s scattered angry energy. Now Howard is calm & confident. It’s as compelling as ever.
A delusional and undiscerning Stern ‘fan’ that believes he is at the top of his game. He is not. He is in an unrestrained descent and will never be the same. In the 90′s I was an avid and devoted Stern fan that offered no apologies. About 2 years ago and maybe around 8 too late, I quit listening. Howard became one of the people he used to rightfully scorn and lampoon. He seems completely unaware that he is of that ilk now, his show a bloated, slothful and sad caricature of its former self though his newly found trophy wife praises it during her regular guest appearances. Quite a shame.
Show never funnier or better ? tell us which part ? Hamptons parties ? American Idol ? Strippers / Porn Stars ? Beth ? Dancing with the stars ? idol ? sex talk from the geriatric homosexual Takei ? the same recycled over and over fake phony phone calls ? Beth ? Beth ? Beth ?
Tell us Mr German how that trumps all the great comedy bits from years past ? Or are you just easily amused ?
like
Lay off the Grey Goose Howard, you’re getting even more delusional.
Ever since moving to Sirius, the show has become boring, unfunny, and irrelevant. I don’t think Sirius will care if Howard’s 10 listeners cancel.
You are abso-effen-lutely correct. No Stern, no Sirius/XM.
Your Show of Shows was Sid Ceaser. Milton Berle had his own show.
Is Stern trying to be credited with bringing in the subscribers from XM? If so, that had nothing to do with him. Don’t be a greedy turd, Howard.
Wait Stern didn’t retire yet? He’s only working 15 days between now and Labor Day, I thought that he basically was retired.
Sirius won’t go under if Stern quit tomorrow, but Sirius will go under eventually because with 4G phones and google letting you keep 20 thousand songs in the cloud, no one will need it. Maybe if Sirius was giving more promotion to other talk hosts other then Howard, then maybe they would have a shot at surviving. Opie and Anthony released the Anthony Weiner photo, had tens of thousands of articles around the world mention them and Sirius didn’t even know how to use it to their advantage.
I only still have XM for Ron and Fez and some sports (b/c i dont live in the area for which I am a fan).
also, it was the portable Xm tuner that I could record content. I used to have a 3+ hour a day commute, so it was great to listen to what i want, when I want.
From a purely legal standpoint, I can’t see how Sirius is correct. They merged with XM. They have no legal grounds to claim their merged company is not actually merged for purposes of performance or other bonuses. You either officially merged, or you didn’t. Stern is being paid too much, but the time to dispute that was before the company signed him. If they’d do this to their top-rated host, I question what other talent they are going to attract in the future. What big name host would want to put up with their antics? This is a clear example of a company shooting themselves in the foot.
If Stern was so unhappy with Sirius, why did he re-sign with them for another 5 years? Couldn’t he have gone anywhere else? Oh wait, no one will pay him a kings ransom for working 3 days a week and getting what seems to be unlimited vacation. For those who say they will cancel when Stern goes, well, you should cancel now becuase he never seems to be live on the air anymore.
They better do what ever they can to keep that Eighties relic happy, because the cutbacks everywhere ELSE to afford that over-inflated ego’s over-payed salary is causing a vast number of other very talented people to jump ship to whatever the next thing in radio is (podcasts) since they’re NEVER going to be compensated appropriately by Sirius XM, otherwise known as the Bank of Stern.
As with so many here, I would cancel Sirius if Stern were gone.
Stern deserves every penny. Stern for President 2012
11 million SiriusXM subscribers can’t hear the Howard Stern Show because they have XM subscriptions. They chose to be XM subscribers for the offerings on that service. Howard Stern has nothing to do with their subscriptions and they should not be counted as subscribers under Stern’s contract. Howard is a money hungry, faded star that can’t deal with the fact that he is no longer at the top of the heap. Maybe if he put some effort into his show instead of being on perpetual vacation he’d feel better.
I don’t agree with your characterization of Stern, but I agree with the rest. I have an XM subscription that does not include Stern or Martha Stewart. I don’t want it and I definitely don’t want to pay extra to get it. I don’t see how Stern can get credit for my subscription if I am not listening to him. How did he bring me to Sirius? Why should he be rewarded for someone who chose not to pay extra to listen to him?
It is all in how it is written in his contract. I don’t think Stern is a bad guy, but I don’t see the logic here.
XM subscribers can hear Howard.
No, only if they buy the “Best of Sirius” package for another $6 a month. really the “best of XM” is far better to buy if you were a Sirius subscriber. Most all of the sports were on XM.
So no, tons of XM listeners cannot hear Howard.
Completely agree and accurate!
Sirius went from a tiny company completely overshadowed by XM into a company so big it took over XM. The only reason for that is Howard Stern and he deserves the money he is owed. If XM went out of business instead of merging with Sirius alot of those subscribers would have gotten Sirius and there would be no argument. They should just give Stern what he deserves. Karmenzon had no problem giving him and his friends great stock options when Liberty came in to help Sirius with money, something Stern was not even told about. If they can all make money what is the big deal with Stern making more money when he is the reason Sirius still exists?
Wow…plenty of sheep in here! According to honest Abe, Stern invented radio, found the polio vaccine, swam the English channel backwards. Get a life Abe, what has Stern ever done for you personally. I cancelled my Sirius accept few years ago. Show is no where what it used to be. Stern USED to get A listers, and funny comedians, but that was back on terrestrial. All he gets now is Joan Rivers, and incoherent Dave Arket. Stern is insignificant now, nobody listens anymore. What do you expect when he says he ” pisses on his fans” and “he hates doing the show”. As for the law suit, he has no leg to stand on. Sirius has paid him very well, and paid him other bonuses for his preformance. This is just another marble grab by Stern, he wants them all.
Please learn to spell before adding comments, it was very difficult to follow what you were saying.
I’m of two minds on this one. One, you have a man that made that company what it is, and it never would have survived without Stern moving to them. You can even argue that there is no merger with that many subscribers if he doesn’t show up as Sirius may have folded or been bought out by XM.
That being said, I’m not sure that I agree that the 10 million subscribers really fall under his bonus compensation. They technically didn’t purchase Sirius because of Stern, but I promise you that a lot of them stayed on because of him. Settle for half of what he believes he is owed and move on.
Cause and effect. Had Stern not signed with Sirius the XM merger wouldn’t have happened because there would be no Sirius to merge. Pay Howard cause he’s all you got. Satelite radio needs an ace in the hole badly. They rely on Howard and I think most people resent him for that(Opie and Anthony). Howard could leave Sirius and launch his own fucking Satelite company. Or do podcasts. He *is* Satelite radio. Most people don’t have Satelite radio for the music I assure you. Infact I’d argue that Satelites problem is there are too many channels to navigate through. Keep it simple stupid. Average people like equipment to be easy, quick, and convient. Satelite radio is none of those things. Howard could launch his own(not counting the on demand channel already) cable channel ala Oprah and premium website plus he’d be his own boss and make millions. He’s a great if not the best interviewer so he gets his own network and programs it with all the sex selling demographics he’s known for and he’d be bigger than ever. I know Radio is his first and only love but the dude knows his audience and knows how to sell
Game set match
If you want to be fair, since the merger the platform has allways been split in 2. I would say that the only compensation that Stern should get is with those that carried over from XM that bought into the best of sirius package and any new subcribers to the sirius package only after the merger. What’s so hard to understand with that? Now if Stern thinks that the XM only platform has anything to do with him, then that’s delusional,, hoohoo tell em Fred!
Scary that the Opie & Anthony fans are right. :-O
It’s easy to figure out for XM listeners – the XM listeners who ADD the best of Sirius should count, as they specifically want to hear Stern. The XM listeners who didn’t opt for that, shouldn’t be counted. What’s so damn hard about figuring that out????
Eloquently stated, Honest Abe. Though Uncle Miltie was not the comic genius who brought us Your Show of Shows. That was Sid Caesar. Milton Berle’s show was the Texaco Star Theater… and Bababooey to y’all.
Stern is a cultural icon. Sirius AND XM would now be toast had Howard taken his act elsewhere. There would have been no merger. I make my subscription payment for one personality only – and when he goes I go. PAY THE MAN.
Let’s test it. I am cancelling one of my subscriptions. What if we all cancel on a Friday. Howard pull the trigger. We will show very quickly how be affects subscriptions.