Media Giants Forcing Smaller Guys Out
Headline Legal News
A magazine wholesaler claims industry giants - including The News Group and Time Inc. - are colluding to drive it out of business, and already have destroyed "the only other non-colluding wholesaler in the market," which went out of business last week. In its federal antitrust complaint, Source Interlink Cos. claims 10 monopolist conspirators have cut it off from People, Sports Illustrated, Time, Entertainment Weekly and other major mags, threatening Source's 8,000 employees.
Source sued these defendants: American Media, Bauer Publishing Co., Curtis Circulation Co., Distribution Services Inc., Hachette Filipacchi Media US, Hudson News Co., Kable Distribution Services, The News Group, Time Inc., and Time/Warner Retail Sales & Marketing.
"if defendants' schemes are not stopped, Source's entire business, including its good will, reputation, 8,000-employee work force and customer base, will be destroyed," the complaint states. "Indeed, defendants already have succeeded in destroying Anderson, the only other non-colluding wholesaler in the market, by also recently cutting it off from all supplies of the publishers' magazines. Anderson announced on Feb. 7, 2009, that it had no recourse but to cease normal business activities immediately."
Source demands a restraining order and injunction "to enjoin defendants from continuing their collusive anti-competitive scheme - in clear violation of Section 1 of the Sherman Act, 15 U.S.C. § 1, and common law - to attack, disparage and destroy Source's business. Emergency relief is necessary to prevent the imminent irreparable harm - the destruction of Source's business and the monopolization of the United States wholesale magazine distribution market - that the misconduct of defendants, major magazine publishers, their distributors, and two of the only four major wholesalers in the United States, will, if not restrained, doubtless cause."
Source claims the defendants have "cut Source off from People, Sports Illustrated, Entertainment Weekly, Time and other major magazines; spread disparaging rumors about Source and its financial condition to its customers, employees and others in the industry; encouraged Source's customers to cease doing with it through, among other things, such false rumors; sought to coerce Source into selling its distribution facilities to defendants at fire sale prices; and raided Source's employees and sought to steal the intellectual property that those employees used to run its business. ...
"Defendants' indisputable goal is to destroy Source's business so that defendants - through Hudson and News Group, the two remaining wholesalers - will monopolize the wholesale market and use that monopoly power to shift to retailers and consumers - and away from publishers - the entire financial burden resulting from worsening market conditions and publisher-induced inefficiencies in the distribution system."
Source is represented by Marc Kasowitz with Kasowitz, Benson & Torres.
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In fact, all 50 states provide for similar subrogation. However, none of them precisely outlines which payments or costs paid by a compensation carrier constitute “compensation” and can be recovered. The result is industry-wide confusion and an ongoing debate and argument with claimants’ attorneys over what can and can’t be included in a carrier’s lien for recovery purposes.
In addition to medical expenses, death benefits, funeral costs and/or indemnity benefits for lost wages and loss of earning capacity resulting from a compensable injury, workers’ compensation insurance carriers also expend considerable dollars for case management costs, medical bill audit fees, rehabilitation benefits, nurse case worker fees, and other similar fees. They also incur other expenses in conjunction with the handling and adjusting of workers’ compensation claims. Workers’ compensation carriers typically assert, of course, that, they are entitled to reimbursement for such expenditures when it recovers its workers’ compensation lien. Injured workers and their attorneys disagree.