Court Grants Summary Judgment Motion of Kramer Levin Client Sirius XM Radio Dismissing With Prejudice "Howard Stern" Law Suit

On April 16, 2012, the Commercial Division of N.Y. Supreme Court, N.Y. County, granted the summary judgment motion of Sirius XM Radio Inc. and dismissed with prejudice the breach of contract action brought against Sirius XM by One Twelve, Inc. (the production company of world-renowned radio and entertainment personality Howard Stern) and Don Buchwald (Stern's manager). One Twelve and Buchwald alleged that Sirius XM had breached the agreement that licensed Sirius XM to broadcast Stern's radio program when it did not pay certain performance based compensation amounting to $300 million for One Twelve and $30 million for Buchwald. The agreement provided for payment of up to five blocks of stock worth $75 million each for One Twelve and $7.5 million for Buchwald if the number of Sirius subscribers exceeded certain projections included in the agreement. At issue in the case was whether the number of XM subscribers should be counted as "Sirius subscribers" following the July 2008 merger between a subsidiary of Sirius XM and XM Satellite Radio Inc. The court accepted the argument of Sirius XM that XM subscribers should not be counted as “Sirius subscribers,” holding that “the clear, unambiguous language” showed that the parties intended "Sirius subscribers" to refer only to those person who subscribed to the Sirius satellite radio service (and not those who subscribed to the separate XM satellite radio service). By dismissing the complaint with prejudice, the court made clear that Sirius XM had fully performed its obligations to One Twelve and Stern. The Kramer Levin team was comprised of Firm Co-Chair and Litigation Partner Gary P. Naftalis, Litigation Partner Michael S. Oberman, IP Partner Peter A. Abruzzese and Litigation Associate Jared I. Heller.