[BC] LMAs - How Far Can They Go?

[Cowboy]

On Saturday 28 January 2006 08:32 am, Steve wrote:
>
>  ----- Original Message ----- 
>  From: Cowboy 

>  >> The licensee remains responsible for the operation of the
>  >> radio station within the terms of its license, ( including EAS )
>  >> AND must maintain that "meaningful" presence.
>  >> Two people must be employees of the current licensee.
>
>  Well, that part is has been handled. However, the LMA holders are 
reimbursing the licensee for these saleries.

 The fees exchanged for the LMA are well beyond my expertise, but
 I see nothing wrong with that on the surface.

>  The licensee has turned over their bank accounts to the LMA holders. They 
account for all the income. They pay the licensee 1500 bucks a month plus a 
capped fee of 500 bucks for sales. So some months that fee could be 2 grand. 
Now listen to this one. The license holders believe if they were nabbed by 
the FCC for violations they would simply sue the LMA holders for the fines!

 Probably, but the FCC has the discretion to block that kind of "cost 
recovery"
 so I'd definitely be getting advice of counsel on that score !

 Sounds like a very high stake gamble to me, but what do I know ?

>  The LMA has been conveniently setup as an LLC. Hey, the LLC dumps the bank 
account and that's it as (and I'm sure you probably know how LLCs work) that 
IS the only asset they have. THE CASH. They come out smelling like a rose and 
queitly walk away.

 Perhaps. I'm not a lawyer.

>  Sue them? I think not. Well, they can attempt to but they'll not get a 
dime.

 That's questionable.
 If the agreement is held to be a violation of applicable law, then there
 is no agreement.
 One of the few things I do know about law, is that one can NOT contract for
 anything that violates other law.

>  Couldn't they be deemed by the FCC unfit to hold a license?

 Probably, if a complaint were made, and the FCC had the same feelings.

>  I know you're not a lawyer but some of these things seem obvious to me but, 
then again, I could be wrong. Something is not right about this whole thing 
and I'm trying to get a grip on just what those things might be.      
>
>  The bottom line here Cowboy is they (the current licensees) want to get out 
of the biz so badly they've turned over the operation to the LMA folk.

 That's not terribly uncommon.

>  >> The LMA's I have been involved with, short version :
>   
>  >> The licensee isn't technically responsible for content, but that's
>  >> about where disavowing responsibility stops.
>
>  That's what I thought. 
>
>  Thanks for your input. It's always appreciated.
>
>  Steve
>  Steve Walker Productions
>
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-- 
Cowboy

http://cowboys.homeip.net

I could dance till the cows come home.  On second thought, I'd rather
dance with the cows till you come home.
		-- Groucho Marx