David Lombino continues his coverage of the Air America financial scandal, advancing the story in parallel to the extraordinary efforts of Michelle Malkin and Brian Maloney. Lombino reports in today's New York Sun that Piquant Media's bill from Multicultural Radio far exceeds the $225K described in the investigative report by the bloggers, and in fact now exceeds a million dollars:

An attorney whose client is suing the Air America radio network said yesterday that the May litigation is part of a larger attempt by the client, an owner of radio stations, to collect more than $1.5 million it says it is owed. ...

The lawsuit filed by MultiCultural in May charges that the transfer of ownership of Air America to Piquant LLC from Progress Media in May 2004 was illegal and was intended only to maintain the network's assets while abandoning its creditors.

"It's called a fraudulent conveyance - same people, same assets, they are just trying to avoid their liabilities," Mr. Mastro said yesterday. "A company that has debts can't just change its name, assume all the assets, and refuse to pay its liabilities. ... The same individuals who contacted us and described themselves as Piquant were also part of the management and ownership of Air America."

That matches the description of the Progress Media-Piquant Media "sale" given by other attorneys, including that of frequent CQ analyst Eric Costello. Costello gave Malkin and Maloney a detailed and comprehensive review of the documents in the blog report which defy easy summarization and excerpting; Michelle posted the entire review at her site.

This story actually hails back to April 14, 2004, when Matt Drudge first reported that Air America had itself locked out of its offices in Los Angeles and Chicago. At the time, Multicultural Radio made it clear that AAR owed them over a million dollars in airtime fees, a claim which AAR hotly denied:

MultiCultural Radio Broadcasting's conduct in this matter has been disgraceful. To shut off a broadcast that listeners rely on without warning and in the middle of discussions is the height of irresponsibility and a slap in the face of the media industry. In addition, it is a clear violation of their contractual obligations, and we are seeking legal remedies against them in court.

In the past two days, what we have seen are the aftershocks of the two different but related court actions. The $225K judgement against AAR came from their lawsuit against Multicultural for taking them off the air and locking them out of LA and Chicago. They lost that lawsuit -- actually wound up dropping it -- and according to the contract between AAR and Multicultural, the losing party in any legal action assumes responsibility for legal fees. AAR had attempted to argue that their agreement to withdraw the action meant that no one lost, and therefore all parties paid their own attorney fees -- wich as Michelle and Brian reported two days ago, the court found both unconvincing and highly unamusing.

Multicultural still wants its airtime fees paid. One assumes that since even AAR admitted it couldn't sustain its countersuit, Multicultural has a high likelihood of winning on the merits -- and that AAR will not only have to pay the $1.5 million, but also another round of legal fees. In light of yesterday's Part II of the blog series, one has to ask whether Piquant disclosed all of these liabilities to the potential investors in Nova M, the new company being formed by Piquant/Progress investors to purchase rural radio stations for AAR broadcasts.

Addendum: The Sun notes that Evan Cohen told Gloria Wise that he needed a $35,000 personal loan in 2003 to take care of his "gravely ill" father. It turns out that his father was more ill than anyone at GW knew; he died in 1991. Who knew that Cohen was related to Generalissimo Francisco Franco?

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» Air America/2 from The Right Nation
Radio Equalizer and Michelle Malkin keep on hitting hard on the Air America scandal. And this time, thanks to the last developments of their (outstanding) investigative job, they accomplished to breach the wall built by mainstream media to protect Al... [Read More]

Tracked on August 19, 2005 10:02 AM

» Err America Woes from Hard Starboard
Piquant Media's tab is spiraling upward at an exponential rate: An attorney whose client is suing the Air America radio network said yesterday that the May litigation is part of a larger attempt by the client, an owner of radio stations, to collec... [Read More]

Tracked on August 19, 2005 10:08 PM