[BC] LMAs - How Far Can They Go?

[Mike McCarthy]

Furthermore, if the violations of the applicable statutes are criminal or 
civil and can be proven willful, the LLC doesn't shield the officers of the 
company for prosecution in either forum.  Tax law is a perfect example of 
corporation limits not applying to officers.

MM

At 12:34 PM 1/29/2006 -0500, Cowboy wrote
>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
>
>
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