Clear Channel Settles Lawsuit

Clear Channel Communications, Inc. has settled the first of what could be a long string of lawsuits over its purportedly monopolistic marketing tactics.

On June 3, the San Antonio–based radio and concert giant settled a suit brought in 2001 by the Denver-based independent concert promoter Nobody in Particular Presents, Inc. (NIPP) that accused Clear Channel of "monopolistic and predatory practices." NIPP charged that Clear Channel withheld radio play of musicians who signed contracts with other concert promoters and refused to advertise non–Clear Channel concerts on its radio stations.

In May 2004, the federal judge hearing the case threw out charges that Clear Channel monopolized the Denver rock concert market, but allowed the remainder of the case to proceed. NIPP had released internal emails from Clear Channel executives in which they expressed their desire to "crush" the competition, including threats against artists and record labels that refused to capitulate. The case was to begin in earnest on August 2, but the litigants agreed to an out-of-court settlement. "This was a long and difficult battle," said NIPP founder and president Doug Kauffmann. "We are very happy with this agreement." In settling the case, Clear Channel admitted no wrongdoing. Terms were not disclosed.

Clear Channel is the largest radio conglomerate in the US. Clear Channel Entertainment, its concert division, also dominates its industry. Taking advantage of loosened regulations brought into being by the Telecommunications Act of 1996, the company grew to mammoth size through an aggressive merger-and-acquisition program. The company owns 8 of Denver's 50 radio stations. In 2000, Clear Channel acquired New York–based concert promoter SFX for $4.4 billion, and launched a continuing effort to leverage the synergy between radio play and the live concert industry. Many musicians and independent promoters have accused the company of strong-arm tactics in trying to lock up US concert business.

As reported May 31, Clear Channel has also threatened independent recording companies that offer souvenir CDs to concert-goers on-site the day of the performance, claiming to own a patent for the "technology." That claim will probably provoke other lawsuits. In November, Clear Channel will face an antitrust lawsuit in federal court in Chicago, where it is accused by independent promoter Jam Productions of controlling promotion of motor sports.