Ed Stolz has so far been unable to convince a federal judge to block the sale of the three FMs owned by his Royce International Broadcasting. The buyer of the trio has now been revealed. Religious broadcaster VCY America has agreed to pay $6 million for CHRs “92.7 The Revolution” KREV San Francisco, “104.3 Now” KFRH Las Vegas, and “Hot Hits 97.7” KRCK-FM Palm Springs, CA.
U.S. District Court Judge Jesus Bernal appointed broker Larry Patrick to serve as receiver of the stations in July, charging him with overseeing the FMs while he initiated a sale process. The proceeds were to go to pay $1.3 million in copyright damages to several music companies, including Sony/ATV, Universal Music Group, and Warner Music Group. The companies alleged the Stolz-owned stations had played music in their catalogs without obtaining the required licenses. Bernal earlier awarded the music companies damages for each of the eleven copyright violations named in their complaint, some dating to 1981. Stolz appealed the judgement, but the Ninth Circuit Court of Appeals upheld the verdict.
During the past several months Stolz has tried unsuccessfully to block the sale of the stations, including offering to liquidate a family trust to pay the damages. But the music companies and Patrick objected. They told the court the FMs had accumulated more than $3.74 million in debt that could only be paid with their sale. The outstanding debt included $1.9 million owed in copyright damages in addition to $300,000 owed to the Bellaire Tower Homeowners Association; plus $850,000 due to Crown Castle for unpaid rent for a tower and transmission site on Mt. Potosi in Las Vegas used by KFRH; and $175,000 owed to Chuck Hass for a tower and transmission site at Candlestick Park in San Francisco used by KREV. There is also $85,000 due to BMI for past-due royalty payments, $175,000 in outstanding legal fees, and $65,000 payable to Patrick to cover his costs for running the three FMs – plus another $210,000 in brokerage fees.
The latest legal maneuver by Stolz was to argue that after ten months of back and forth with the music companies, he had reached an agreement that would let him cover the damages and keep the stations. But the music companies rejected his allegation that they reneged on that deal, saying Stolz misconstrued an email exchange he had with their attorneys. Stolz in recent weeks deposited $1.3 million with the court as proof he had the money to help solidify his case.
But the court has rejected the motion. Bernal’s ruling said that Stolz’s actions in recent months “in no way suggests [he] believed a settlement agreement had been reached.”
From ‘Revolution’ To Religion
Jim Scheider-led VCY America plans to convert CHRs KREV San Francisco, KFRH Las Vegas, and KRCK-FM Palm Springs to its noncommercial religious teaching format once the sale closes. The cities will be new markets for Milwaukee-based VCY America, which currently owns 29 full-power stations and 24 FM translators across the Midwest and Southwest. Its radio network also has 81 affiliates that carry VCY America programming.
Once the sale closes, Royce International Broadcasting will still own “790 Talk Now” KBET in Las Vegas and two FM translators in the Palm Springs, CA market.