The pile of lawsuits on Jay Penske's desk just gets higher and higher
The pile of lawsuits on Jay Penske's desk just gets higher and higher.
After being sued and countersuing a marketing company over a joint venture last week, the new Variety owner has now sued the former owners of Variety, Reed Elsevier and Reed Business Information for $10 million over alleged breach of contract.
The suit, filed in New York Supreme Court on May 8, alleges that Reed Elsevier did not disclose two contracts during the process of selling Penske the trade for an estimated $25 million late last year.
"Plaintiff has been sued and has incurred and is continuing to incur costs and fees in connection with contracts that Defendants withheld and failed to disclose in due diligence or in the disclosure schedule," the complaint reads.
The contracts include a joint venture with the Beverly Hills Media Group to jointly sell sponsorships, including one for $500,000 sold to Commerce Casino last year, and a contract with California Offset Printers, which printed the daily trade.
All of it looks really to be a case where Penske just doesn't want to pay the contracts that pre-dated him. The BHMG contract is apparently in perpetuity. But the COP contract is only until June 2016.
What print publication doesn't pay its printer?
Says the complaint: “While certain other portions of the Sellers Disclosure Schedule did include a reference to a July 2012 amendment to the COP printing agreement (with no reference to any other amendments), no such amendments were ever provided by Defendants as part of Plaintiffs due diligence in connection with the APA and were not included as assigned contracts on the Sellers Disclosure Schedule."
Suing the European-based conglomerate that sold him Variety makes for a messy dispute; it hardly looks seemly for the new owner of what is supposed to be the Bible of show business. Variety always had standards. Now it has lawsuits.
Penske is looking for damages in an amount to be proven at trial, "which amount includes the principal sum of $10 million."