All seemed hunky dory in the land of Howard Stern when he announced another 5-year contract with SiriusXM Satellite Radio (Nasdaq: SIRI) in the final days of his initial 5-year $500M deal with the company. As Howard is heading into his fourth month of the new contract, it was announced that he has filed a lawsuit against his employer for not paying out performance-based stock bonuses that he was promised.
Stern spoke briefly about the lawsuit on the air during Wednesday’s broadcast, and went on the air as usual on Thursday and hardly even acknowledged the suit. According to reports, Sirius initially paid out the bonuses, but hasn’t since 2006, the first year of Stern’s initial contract with the company.
Shortly after, Sirius acquired XM Radio, the only other satellite radio company on the market. Stern and his agent attest that without the popularity they brought to Sirius, the acquisition/merger could never have happened. According to the suit, the Howard Stern Show increased Sirius’ subscriber base beyond expectations.
Sirius had roughly 230,000 subscribers compared to XM’s 1.3 million in 2004. At the beginning of this year, the merged satellite radio company reportedly has over 20 million subscribers.
SiriusXM claims that they have absolutely fulfilled their obligations and are “disappointed” in the lawsuit. They claim that Stern and his agent are including XM subscribers in the qualifier for the bonus and that should not be the case.
If we know Howard Stern like we think we do, we will hear plenty about this pending suit in the coming weeks… most likely via profanity-laced daily rantings.