Anda di halaman 1dari 22

Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 1 of 22

1 MORGAN, LEWIS & BOCKIUS LLP


Benjamin P. Smith, State Bar No. 197551
2 Christopher J. Banks, State Bar No. 218779
Dennis J. Sinclitico, Jr., State Bar No. 240260
3 One Market, Spear Street Tower
San Francisco, CA 94105-1126
4 Tel: 415.442.1000
Fax: 415.442.1001
5
Attorneys for Plaintiff
6 ENTERCOM CALIFORNIA LLC

9 UNITED STATES DISTRICT COURT

10 EASTERN DISTRICT OF CALIFORNIA

11

12 ENTERCOM CALIFORNIA LLC, (F/K/A Case No. 2:14-cv-01523 GEB AC


ENTERCOM SACRAMENTO, LLC),
13 PLAINTIFF ENTERCOM
Plaintiff, CALIFORNIA LLCS NOTICE OF
14 MOTION, MOTION AND
vs. APPLICATION FOR (1) TEMPORARY
15 RESTRAINING ORDER; AND (2)
WILLIAMS BROADCASTING ORDER TO SHOW CAUSE RE:
16 INCORPORATED, PRELIMINARY INJUNCTION;
MEMORANDUM OF POINTS AND
17 Defendant. AUTHORITIES IN SUPPORT
THEREOF
18
Date:
19 Time:
Location:
20 Judge:
Action Filed:
21

22

23 REDACTED VERSION

24

25

26

27
28
MORGAN, LEWIS &
BOCKIUS LLP
ATTORNEYS AT LAW PLTFS MOTION FOR TRO
SAN FRANCISCO AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 2 of 22

1 TO: DEFENDANTS ABOVE-NAMED AND THEIR ATTORNEYS:

2 PLEASE TAKE NOTICE that, at _______ _.m., on July ___, 2014, or as soon thereafter

3 as the matter may be heard in Courtroom ___ of the above-entitled court, located at Robert T.

4 Matsui Federal Courthouse, 501 I Street, Sacramento, California, 95814, Plaintiff Entercom

5 California LLC (Entercom), by and through its counsel, undersigned attorneys, will and hereby

6 do move the above Court for a Temporary Restraining Order preventing and enjoining Defendant

7 from licensing, offering, selling, performing, broadcasting, or otherwise providing the right to

8 broadcast the Rob, Arnie & Dawn Show or any other radio program involving its personalities

9 in the terrestrial Sacramento area to any party other than Plaintiff or otherwise breaching Section
10 25 of the 2005 Program Agreement between Plaintiff and Defendant; and for an Order to Show

11 Cause why a preliminary injunction should not issue to the same effect.

12 This motion and application are grounded in the requirements of Fed. R. Civ. P. 65

13 and are based upon the Complaint and all of the files and proceedings herein, including the

14 declarations of Michael Dash, Sean Shannon, and Tim Murphy, all submitted herewith. A

15 memorandum of points and authorities in support of Plaintiffs motion is also submitted herewith.

16 STATEMENT OF ISSUE

17 Whether the Court should issue a temporary restraining order enjoining Defendant from

18 licensing, offering, selling, performing, broadcasting, or otherwise providing the right to

19 broadcast the Rob, Arnie & Dawn Show or any other radio program involving its personalities
20 in the terrestrial Sacramento area to any party other than Plaintiff or otherwise breaching Section

21 25 of the 2005 Program Agreement between Plaintiff and Defendant.

22

23 Dated: June 26, 2014 MORGAN, LEWIS & BOCKIUS LLP


24 By /s/ Benjamin P. Smith
Benjamin P. Smith
25 Attorneys for Plaintiff
ENTERCOM CALIFORNIA LLC
26

27
28
MORGAN, LEWIS &
BOCKIUS LLP
ATTORNEYS AT LAW 1 PLTFS MOTION FOR TRO
SAN FRANCISCO AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 3 of 22

TABLE OF CONTENTS
1

2 Page

3 I. INTRODUCTION .............................................................................................................. 1

4 II. STATEMENT OF FACTS ................................................................................................. 1

5 A. Entercom California LLC and the Programming Agreement ................................. 1

6 B. The Rob Arnie & Dawn Show Is Unique and Valuable...................................... 2

7 C. To Retain the Show, Entercom Has the Right to Match Competing Offers ........... 3

8 D. Entercom Has Matched Williamss Third-Party Offer ........................................... 4

9 E. Loss of the Show Will Cause Irreparable Harm ..................................................... 7

10 III. ARGUMENT ...................................................................................................................... 7

11 A. Standards for a Temporary Restraining Order (TRO)......................................... 7

12 B. Entercom is Likely to Succeed on Both its Breach of Contract Claim and


its Breach of the Duty of Good Faith and Fair Dealing Claim. .............................. 8
13
1. Williams Breached the License Agreement ................................................ 8
14
2. Williams Breached its Duty of Good Faith and Fair Dealing................... 10
15
C. Loss of Broadcasting Rights to the Show Would Cause Irreparable Harm to
16 Entercoms Goodwill, Advertising Revenues, and Employees ............................ 11

17 D. The Balance of Equities Tips Sharply in Entercoms Favor................................. 14

18 E. Public Interest........................................................................................................ 14

19 F. A Bond is Not Required........................................................................................ 15

20 IV. CONCLUSION ................................................................................................................. 15

21

22

23

24

25

26

27
28
MORGAN, LEWIS &
BOCKIUS LLP i PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
AND OSC; MPA IN SUPPT
SAN FRANCISCO
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 4 of 22

TABLE OF AUTHORITIES
1
Page(s)
2

3 CASES
4 Alliance for the Wild Rockies v. Cottrell,
632 F.3d 1127 (9th Cir. 2011)............................................................................................. 8, 10
5

6 Anselmo v. Mull,
CIV. 2:12-1422 WBS, 2012 WL 5304799 (E.D. Cal. Oct. 25, 2012) .................................... 12
7
Arias v. Solis,
8 754 F.Supp. 290 (E.D.N.Y. 1991) .......................................................................................... 13

9 Barahona-Gomez v. Reno,
167 F.3d 1228 (9th Cir. 1999) supplemented, 236 F.3d 1115 (9th Cir. 2001) ....................... 15
10
Boland, Inc. v. Rolf C. Hagen (USA) Corp.,
11
685 F. Supp. 2d 1094 (E.D. Cal. 2010)............................................................................... 9, 10
12
C. Robert Nattress & Associates v. Cidco,
13 184 Cal. App. 3d 55 (Cal. Ct. App. 1986) ................................................................................ 9

14 Carma Developers (Cal.), Inc. v. Marathon Dev. California, Inc.,


2 Cal. 4th 342 (1992) .............................................................................................................. 10
15
Celador Int'l Ltd. v. Walt Disney Co.,
16 347 F. Supp. 2d 846 (C.D. Cal. 2004)..................................................................................... 11
17
eBay, Inc. v. Bidder's Edge, Inc.,
18 100 F.Supp.2d 1058 (N.D.Cal.2000) ...................................................................................... 12

19 Granny Goose Foods, Inc. v. Brotherhood of Teamsters,


415 U.S. 423 (1974) .................................................................................................................. 8
20
H & R Block Tax Services LLC v. Kutzman,
21 681 F.Supp.2d 1248 (D.Mont.2010) ....................................................................................... 15
22
Hibu Inc. v. Lawrence, SACV
23 13-0333-DOC, 2013 WL 6190538 (C.D. Cal. Nov. 25, 2013)............................................... 11

24 Houston Oilers, Inc. v. Neely,


361 F.2d 36 (10th Cir. 1966)................................................................................................... 13
25
Lemat Corp. v. Barry,
26 275 Cal. App. 2d 671 (1969)................................................................................................... 12
27 Lockheed Missile & Space Co., Inc. v. Hughes Aircraft Co.,
28 887 F. Supp. 1320 (N.D. Cal.1995) .......................................................................................... 8
MORGAN, LEWIS &
BOCKIUS LLP ii PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
AND OSC; MPA IN SUPPT
SAN FRANCISCO
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 5 of 22

TABLE OF AUTHORITIES
1 (continued)
2 Page(s)
3 MCA Records v. Newton-John,
90 Cal. App. 3d 18 (1979)....................................................................................................... 12
4
Motown Record Corp. v. Brockert,
5
160 Cal. App. 3d 123,135 (1984)............................................................................................ 13
6
Paschall v. Kansas City Star Co.,
7 441 F. Supp. 349 (W.D. Mo. 1977) ........................................................................................ 12

8 Rent-A-Ctr., Inc. v. Canyon Television & Appliance Rental, Inc.,


944 F.2d 597 (9th Cir. 1991) .................................................................................................. 12
9
Scotts Co. v. United Indus. Corp.,
10 315 F.3d 264 (4th Cir. 2002)................................................................................................... 14
11
Stormans, Inc. v. Selecky,
12 586 F.3d 1109 (9th Cir. 2009)................................................................................................. 15

13 Stuhlbarg Intern. Sales Co., Inc. v. John D. Brushy and Co., Inc.,
240 F.3d 832 (9th Cir. 2001)............................................................................................... 8, 12
14
Ticketmaster L.L.C. v. RMG Technologies, Inc.,
15 507 F. Supp. 2d 1096 (C.D. Cal. 2007)............................................................................. 12, 15
16 United States v. Marine Shale Processors,
17 81 F.3d 1329 (5th Cir. 1996)................................................................................................... 14

18 Wash. Capitols Basketball Club, Inc. v. Barry,


304 F. Supp. 1193 (N.D. Cal. 1969) ....................................................................................... 12
19
Washington Capitols Basketball Club, Inc. v. Barry,
20 419 F.2d 472 (9th Cir. 1969)................................................................................................... 13
21 Winter v. Natural Res. Def. Council,
22 555 U.S. 7 (2008) ...................................................................................................................... 8

23 STATUTES

24 Cal. Civ. Code


3423.................................................................................................................................. 9, 12
25
Cal. Lab. Code
26 2855(a) ............................................................................................................................. 9, 12
27
28
MORGAN, LEWIS &
BOCKIUS LLP iii PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
AND OSC; MPA IN SUPPT
SAN FRANCISCO
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 6 of 22

TABLE OF AUTHORITIES
1 (continued)
2 Page(s)
3 RULES AND REGULATIONS
4 Fed. R. Civ. P. 65(b)(1)(A) ............................................................................................................. 8
5 Fed. R. Civ. P. 65(c)...................................................................................................................... 15
6
OTHER AUTHORITIES
7
http://www.allaccess.com/rock/10-questions/archive/12822/10-questions-with-rob-arnie-
8 dawn .......................................................................................................................................... 3

9
10

11

12

13

14

15

16

17

18

19
20

21

22

23

24

25

26

27
28
MORGAN, LEWIS &
BOCKIUS LLP iv PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
AND OSC; MPA IN SUPPT
SAN FRANCISCO
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 7 of 22

1 I. INTRODUCTION

2 This is a case about the deliberate efforts of defendant Williams Broadcasting

3 Incorporated (Williams) to betray its fourteen-year relationship and breach its contract with

4 plaintiff Entercom California LLC (Entercom) by taking the immensely popular Sacramento-

5 based radio program, the Rob, Arnie & Dawn Show (the Show), from radio station KRXQ

6 (more popularly known as 98 Rock or 98.5 FM) to a competitive station. Williams actions fly

7 in the face of its contractual agreement to allow Entercom the opportunity to match any

8 competitive offer it received for the Show an opportunity that Entercom expressly and timely

9 exercised. Nevertheless, Williams has repeatedly expressed its intent to breach its contract with

10 Entercom and take its Show to a competitor on July 1, 2014.

11 There is no denying that the Show is a unique, marquee radio program in the Sacramento

12 metropolitan area. Since the Show left the Reno broadcasting market in 1999 where it was

13 admittedly limping along and appealing to no one else beyond the Shows core demographic

14 of young men in the Reno area it has become a ratings juggernaut under Entercoms promotion

15 and station management. As Rob Williams, the founder of and principle personality on the Show,

16 explained in a 2012 interview, We came to Sacramento in May, 1999 and in the 50 Arbitron

17 quarterlies since then, we've been #1 18-34 and 18-49 Adults 48 times.1 [W]e work harder at

18 it and do it better than everyone else. Id.

19 The Show represents special, unique talent that cannot be replaced. Unless the relief

20 requested in this motion for temporary restraining order and preliminary injunction is granted,

21 Entercom stands to suffer substantial damages and irreparable harm. Advertising revenues,

22 employee compensation, and customer, listener and employee goodwill will all suffer great harm

23 if Williams is allowed to take its Show to a competitor in direct violation of its contractual

24 commitments to Entercom. Entercom accordingly seeks emergency injunctive relief.

25 II. STATEMENT OF FACTS

26 A. Entercom California LLC and the Programming Agreement

27 Entercom California LLC, f/k/a Entercom Sacramento, LLC (Entercom) is an indirect

28 1
See http://www.allaccess.com/rock/10-questions/archive/12822/10-questions-with-rob-arnie-dawn.
MORGAN, LEWIS &
BOCKIUS LLP 1 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 8 of 22

1 wholly-owned subsidiary of publicly-traded Entercom Communications Corp., one of the largest

2 radio broadcasting companies in the United States with a nationwide portfolio of over 100 radio

3 stations in 23 markets, including six stations in Sacramento. See Declaration of Mike Dash

4 (Dash Decl.), 4. Entercom Communications Corp. and its subsidiaries serve as the radio

5 broadcast partner for many professional sports teams (including the Oakland Raiders and

6 Athletics), and have won multiple awards for broadcasting excellence. Id. at 5.

7 Following a prior 2000 agreement, and on June 30, 2005, Entercom entered into a

8 Programming Agreement with Williams Broadcasting Incorporated (Williams), a California

9 corporation, for broadcast rights to the Rob Arnie & Dawn Show. Dash Decl., 10, Ex. 1. The
10 Rob Arnie & Dawn Show, or Show, is a syndicated morning talk show that has aired for

11 nearly fourteen years on Entercoms Sacramento radio station KRXQ (more popularly known as

12 the Rock or 98.5 FM). Id. The Programming Agreement afforded Entercom (and KRXQ)

13 REDACTED
14

15 . Id. at 12, Exh. 1 [Programming Agreement at 2]. The

16 Programming Agreement is REDACTED . Id. at 11.

17 In exchange for REDACTED


18

19 . Dash Decl., Ex. 1[Programming


20 Agreement at 6].

21 B. The Rob Arnie & Dawn Show Is Unique and Valuable


22 The Show is a morning drive-time syndicated broadcast featuring Robert Williams, Arnie

23 States, and Dawn Litz (a/k/a Dawn Rossi) as artists and personalities. Dash Decl., Exh. 1 at

24 1(b). The Show features unique programming dependent upon banter by and between each of

25 these artists, as well as interaction with callers. See Declaration of Sean Shannon (Shannon

26

27 REDACTED
2
The Programming Agreement refers to
28 .
MORGAN, LEWIS &
BOCKIUS LLP 2 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 9 of 22

1 Decl.), 7. Each of the Show personalities are well-known in the Sacramento area and beyond,

2 as the Show maintains its own website and has been the subject of repeated media attention. Id.

3 The Show has been, and continues to be, immensely popular with Sacramento radio

4 listeners, and has consistently ranked first or second in terms of listenership among the most

5 important demographics for purposes of advertising revenues. Shannon Decl., 5-6. Many

6 listeners tune into KRXQ simply for the Show, and the Show is critical in driving listenership

7 both during the critical drive-time period and throughout the day. Id. at 5-7. The Shows

8 personalities recognize this, and have publicly boasted about their ratings success. See

9 http://www.allaccess.com/rock/10-questions/archive/12822/10-questions-with-rob-arnie-dawn.
10 Given its uniqueness and popularity, the Show is critical to the economic success of KRXQ, the

11 compensation of Entercom employees, and Entercoms goodwill. Id. at 4-12.

12 C. To Retain the Show, Entercom Has REDACTED


13 Given the import of the Show, REDACTED
14

15

16

17

18

19
20

21

22

23

24

25

26

27
28 See id. REDACTED
MORGAN, LEWIS &
BOCKIUS LLP 3 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 10 of 22

1 REDACTED . See Dash Decl., Ex.1 [Programming Agreement 11]

2 REDACTED
3

7 D. Entercom Has Matched Williamss Third-Party Offer


8 On or about 2011, Entercom began discussions with Williams regarding a further

9 agreement to retain its decade-old rights to the Show in the Sacramento area. Dash Decl., 15.
10 These discussions intensified in 2014, as the term of the Programming Agreement reached an

11 end, with Entercoms provision of term sheets and negotiations wherein the parties each took

12 various positions regarding the terms of a new agreement. Id. at 16. On June 13, 2014,

13 Williams advised Entercom that Williams was negotiating a potential agreement with another

14 party. Id. at 17, Exh. 2. Entercom made no objection to these efforts, knowing that it would

15 have the right to match any offer Williams was able to obtain.

16 On or about June 18, 2014, Williamss counsel wrote to Entercoms in-house counsel,

17 Mike Dash, advising Entercom of an offer by third-party Clear Channel Broadcasting (Clear

18 Channel). Dash Decl., 18, Exh. 3. In notifying Entercom of this offer, Williams specifically

19 acknowledged Section 25 of the Programming Agreement, and indicated that Entercom could
20 match the offer, if it so desired. Id. at Exh. 3 REDACTED
21

22 .

23 The Clear Channel offer and Deal Term Sheet Summary contained fourteen separate

24 terms including, among others, REDACTED


25

26 . Dash Decl., Exh. 3.

27 Consistent with Section 25 of the Programming Agreement, on June 21, 2014, Entercom
28 matched the terms of the Clear Channel proposal, advising Williams:
MORGAN, LEWIS &
BOCKIUS LLP 4 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 11 of 22

1 Entercom is prepared to match all of the provisions of the Offer [of


Clear Channel] in full and again, hereby exercises its right to do
2 so.

3 Dash Decl., 21, Exh. 5. Entercom not only matched the terms of the Clear Channel offer

4 triggering the requirement of Section 25 that the parties REDACTED

5 but also offered to improve upon Clear Channels offer by, among other things,

6 discussing a longer term. Id.

7 After Entercom exercised its right to match the Clear Channel offer, and on June 23, 2014,

8 Entercoms in-house counsel prepared a draft of a 2014 Programming Agreement. The draft

9 incorporated the terms of the Clear Channel offer into the existing Programming Agreement,

10 and made some additional modifications to bring the Programming Agreement (executed in 2005)

11 up to date. Dash Decl., 23, Ex. 7. Entercom also expressed a willingness to discuss drafting

12 and language issues regarding the new agreement. Id.

13 In response to this, and on June 24, 2014, Williamss counsel in an email with an

14 attachment tellingly entitled Dash Letter re: Termination (FINAL) indicated that Entercom

15 has not and cannot match the Clear Channel offer:

16 We write to confirm and memorialize expiry of the agreement


between Entercom and Williams Broadcasting, as well as respond
17 to Entercoms assertion that it believes it can and has in fact
matched the agreement offered by Clear Channel. Williams
18 Broadcasting disagrees that Entercom can or has matched the Clear
Channel proposal, especially considering the additional terms added
19 by Clear Channel, and therefore Williams Broadcasting is not
obligated under section 25 of the current agreement REDACTED
20 REDACTED . Williams Broadcasting intends to
allow the Entercom agreement to expire, per the terms of that
21 agreement, on June 30, 2014 and will not enter into a new
agreement with Entercom.
22
Dash Decl., 24, Exh. 8.
23
Because the June 24, 2014 letter erroneously claimed that Entercom had not matched the
24
Clear Channel offer, Entercom again wrote to Williams. As again made clear in this June 26,
25
2014 communication, attached as Exhibit 9 to the Declaration of Mike Dash, Entercom indicated
26
that it would match each and every term of the Clear Channel term sheet. In addition, and as
27
shown below, Entercom also offered at Williamss election additional superior terms
28
MORGAN, LEWIS &
BOCKIUS LLP 5 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 12 of 22

1 regarding, for example, broadcast of the Show over two digital platforms rather than one:

2 TERM CLEAR CHANNEL PROPOSAL ENTERCOM MATCH PROPOSAL


Term of Agreement 3 years, with fourth year option. 3 years, with fourth year option or, at
3 Williamss election, three years, as
provided for by Section 25 of the
4 Programming Agreement. See Dash
Decl., Exs. 5 [6-21-14 email to K.
5
Hughey]; 7 [Draft Long Form
6 Agreement at 2]; 9 [6-24-14 letter to K.
Hughey].
7 Annual Base Fee and REDACTED REDACTED
Satellite Costs
8 Entercom offered to either
reimburse Williams for satellite costs up
9 to $45,840.00 or provide the services.
See Dash Decl., Exs. 5 [6-21-14 email to
10 K. Hughey]; 7 [Draft Long Form
Agreement at 6(b)]; 9 [6-24-14 letter to
11 K. Hughey].
12 Quarterly Ratings REDACTED REDACTED
Bonus
13
See Dash
14
Decl., Exs. 5 [6-21-14 email to K.
15 Hughey]; 7 [Draft Long Form
Agreement at 7(b)]; 9 [6-24-14 letter to
16 K. Hughey].

17 2014 Summer A 30 day vacation starting on July A 30 day vacation starting on July 1,
Vacation 1, 2014. 2014. See Dash Decl., Exs. 5 [6-21-14
18 email to K. Hughey]; 7 [Draft Long
Form Agreement at 4(a)]; 9 [6-24-14
19 letter to K. Hughey].

20 Annual Vacation Thirty days (and holidays) Thirty days (and holidays). See Dash
Decl., Exs. 5 [6-21-14 email to K.
21 Hughey]; 7 [Draft Long Form
Agreement at 4(a)]; 9 [6-24-14 letter to
22 K. Hughey].
23
Broadcast of Show on Broadcast on iHeart Radio, owned No objection to Broadcast on iHeart
24 Digital Platform by Clear Channel, with right to Radio, owned by Clear Channel, with
create RAD or Radio On right to create RAD or Radio On
25 Demand custom channels. Demand custom channels and/or
Broadcast on TuneIn digital platform,
26

27
28
MORGAN, LEWIS &
BOCKIUS LLP 6 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 13 of 22

1
TERM CLEAR CHANNEL PROPOSAL ENTERCOM MATCH PROPOSAL
2 with right to create RAD custom
channels.3 See Dash Decl., Exs. 5 [6-21-
3 14 email to K. Hughey]; 7 [Draft Long
Form Agreement at 5(c)]; 9 [6-24-14
4 letter to K. Hughey].
5 Endorsements REDACTED
No fee endorsements; No fee endorsements;
6 endorsements at rate of REDACTED
REDACTED See Dash Decl.,
7 . Exs. 5 [6-21-14 email to K. Hughey]; 7
[Draft Long Form Agreement at 8]; 9
8 [6-24-14 letter to K. Hughey].
Content and Time Slot Five hour show (5:00 am to 10:00 Five hour show (5:00 am to 10:00 am)
9 am) with first hour consisting of with first hour consisting of best of
best of recorded programming. recorded programming. See Dash
10 Decl., Exs. 5 [6-21-14 email to K.
Hughey]; 7 [Draft Long Form
11 Agreement at 4(b)]; 9 [6-24-14 letter to
K. Hughey].
12 Additional Markets Clear Channel to use best efforts Entercom to use best efforts to
to broadcast show in additional broadcast show in additional markets.
13 markets. See Dash Decl., Exs. 5 [6-21-14 email to
K. Hughey]; 7 [Draft Long Form
14 Agreement at 5(d)]; 9 [6-24-14 letter to
K. Hughey].
15
Intellectual Property Williamss intellectual property Williamss intellectual property
16 remains its intellectual property. remains its intellectual property. Dash
Decl., Exs. 5 [6-21-14 email to K.
17 Hughey]; 7 [Draft Long Form
Agreement]; 9 [6-24-14 letter to K.
18 Hughey].
Termination For cause, and not as ratings For cause, and not as ratings penalty;
19 penalty; should Rob William be should Rob William be unable to
unable to continue work, Clear continue work, Clear Channel can
20 Channel can terminate on 30 days terminate on 30 days notice. Dash
notice. Decl., Exs. 5 [6-21-14 email to K.
21 Hughey]; 9 [6-24-14 letter to K.
Hughey].
22 Pulling Show Off Clear Channel agrees it will not Clear Channel agrees it will not pull
Air pull the show off the air without the show off the air without good
23
good cause. cause. Dash Decl., Exs. 5 [6-21-14
24 email to K. Hughey]; 9 [6-24-14 letter to
K. Hughey].
25

26

27 3
REDACTED
Because Entercom enjoys only
28
MORGAN, LEWIS &
BOCKIUS LLP 7 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 14 of 22

1 E. Loss of the Show Will Cause Irreparable Harm

2 In the same June 24, 2014 letter, Entercom also notified Williams of the potential need for

3 a temporary restraining order and/or injunctive relief. Dash Decl., Ex. 9. Entercom did so given

4 the irreparable harm it is likely to suffer if Williams refuses to abide by terms of the Programming

5 Agreement, and refuses to enter into a new contract with Entercom, as discussed in detail below

6 and in the declarations filed herewith.

7 III. ARGUMENT

8 A. Standards for a Temporary Restraining Order (TRO)

9 The purpose of a temporary restraining order (TRO) is to preserve the status quo and to

10 prevent irreparable harm just so long as is necessary to hold a hearing, and no longer. Granny

11 Goose Foods, Inc. v. Brotherhood of Teamsters, 415 U.S. 423, 439 (1974). A TRO may be

12 issued upon a showing that immediate and irreparable injury, loss, or damage will result to the

13 movant before the adverse party can be heard in opposition. Fed. R. Civ. P. 65(b)(1)(A).

14 The standard for issuing a temporary restraining order is identical to the standard for

15 issuing a preliminary injunction. Lockheed Missile & Space Co., Inc. v. Hughes Aircraft Co.,

16 887 F. Supp. 1320, 1323 (N.D. Cal.1995); see also Stuhlbarg Intern. Sales Co., Inc. v. John D.

17 Brushy and Co., Inc., 240 F.3d 832, 839 n. 7 (9th Cir. 2001) (standards for issuing a TRO are

18 substantially identical to those for issuing a preliminary injunction). A plaintiff seeking a

19 preliminary injunction must establish: (1) a likelihood of succeed on the merits; (2) a likelihood

20 that plaintiff will suffer irreparable harm in the absence of preliminary relief; (3) that the balance

21 of equities tips in his favor; and (4) that an injunction is in the public interest. Winter v. Natural

22 Res. Def. Council, 555 U.S. 7, 20 (2008).

23 The Ninth Circuit employs a sliding scale approach to the Supreme Courts four-

24 element test. Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1135 (9th Cir. 2011).

25 Under this approach, a preliminary injunction may issue if the plaintiff raises serious questions

26 going to the merits and demonstrates that the balance of hardship tips sharply towards the

27 plaintiff's favor, where plaintiff also demonstrates that irreparable harm is likely, and the

28 injunction is in the public interest. Id. (internal quotation marks omitted).


MORGAN, LEWIS &
BOCKIUS LLP 8 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 15 of 22

1 Having refused an Entercom offer which matched each and every term of the Clear

2 Channel offer, Williams has broken its contractual obligation to grant Entercom the broadcasting

3 rights to the Show in the terrestrial Sacramento market. Because depriving Entercom of the Show

4 for even a short time will cause irreparable harm by the loss of goodwill, advertising revenue and

5 employees, the balance of equities tips in Entercoms favor, and an injunction is in the public

6 interest, the Court should grant Entercoms request for a TRO.

7 B. Entercom is Likely to Succeed on Both its Breach of Contract Claim and its
Breach of the Duty of Good Faith and Fair Dealing Claim.
8
1. Williams Breached the License Agreement
9
10 Under California law, a claim for breach of contract includes four elements: that a

11 contract exists between the parties, that the plaintiff performed his contractual duties or was

12 excused from nonperformance, that the defendant breached those contractual duties, and that

13 plaintiff's damages were a result of the breach. Boland, Inc. v. Rolf C. Hagen (USA) Corp., 685

14 F. Supp. 2d 1094, 1101 (E.D. Cal. 2010) (citations omitted). When determining whether a party

15 has offered similar terms to a competitors offer under a right to match or right of first refusal

16 clause, California courts look to whether the partys offer provides similar value to its

17 competitors offer. See C. Robert Nattress & Associates v. Cidco, 184 Cal. App. 3d 55 (Cal. Ct.

18 App. 1986) (finding that a party effectively exercised its right of first refusal where, though the

19 price term of the partys offer was lower than its competitors offer, the defendant would receive
20 the same amount of money due to absence of a real estate broker fee).

21 Here, the License Agreement is a valid contract for personal services of a unique nature,

22 specifically enforceable by injunction according to statute. See Cal. Labor Code 2855(a); Cal.

23 Civ. Code 3423. The License Agreement explicitly provides that, after Williams delivers to

24 Entercom a third party offer, REDACTED

25

26 See Dash Decl., Ex. 1 [Programming Agreement at 25]. This language is

27 clear and unambiguous REDACTED

28 . As demonstrated in the foregoing chart,


MORGAN, LEWIS &
BOCKIUS LLP 9 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 16 of 22

1 Entercom matched each and every term of Clear Channels offer; yet, Williams refuses to fulfill

2 its obligation REDACTED . Dash Decl., 27. This refusal damages

3 Entercom in myriad ways, including loss of goodwill, sponsorship, and a cornerstone of its

4 program lineup, as explained below. See Part III.C, infra.

5 Entercom expects Williams to argue that Entercoms terms were not a true match to

6 Clear Channels terms. Any attempt by Williams to do so should be rejected. For example,

7 Williams will likely object to Entercoms terms regarding broadcast of the Show on digital

8 platforms, arguing that iHeartRadioowned by Clear Channelis a more valuable digital

9 platform. But, Entercoms offer does not object to Williams being digitally broadcast on
10 iHeartRadio. Dash Decl., Exh. 9. Under the Entercom offer, Williams is free to enter into an

11 agreement with Clear Channel to be carried on its iHeartRadio digital platform in addition to

12 being digitally broadcast on Entercoms TuneIn. See Declaration of Tim Murphy (Murphy

13 Decl.), 9(g)-(h). Thus Entercoms offer matches Clear Channelsunder either offer,

14 Williams may agree to being digitally broadcast on iHeartRadio. Second, Entercoms offer to

15 digitally broadcast the Show on TuneIn is equivalent to, if not more valuable than, Clear

16 Channels iHeartRadio offer, as both platforms offer comparable control, reliability, stability, and

17 performance. See Murphy Decl., 9(a)-(i). Clear Channel contends that iHeartRadio is superior

18 in that it has over 50 million registered users (see Dash Decl., Exh. 8), but TuneIn has more

19 monthly active usersa key industry metric that is more meaningful than the number of
20 registered users. See Murphy Decl., 13-15. TuneIns effectiveness is confirmed by the fact

21 that a substantial number of large broadcasters use TuneIn, some of the most popular podcasts are

22 broadcast on TuneIn, and Clear Channel itself makes some of its content available on TuneIn.

23 See id., 10-12.

24 Entercom matched Clear Channels offer, yet Williams consistently refuses to enter into

25 the three year agreement required under the License Agreement. Entercom is therefore likely to

26 succeed on its claim for breach of contract.4

27
4
At the very least, Entercom has shown serious questions going to the merits. See Cottrell, 632
28 F.3d at 1135.
MORGAN, LEWIS &
BOCKIUS LLP 10 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 17 of 22

1 2. Williams Breached its Duty of Good Faith and Fair Dealing

2 Under California law, [e]very contract imposes upon each party a duty of good faith and

3 fair dealing in its performance and its enforcement. Carma Developers (Cal.), Inc. v. Marathon

4 Dev. California, Inc., 2 Cal. 4th 342, 371 (1992) (internal quotation marks and citations omitted).

5 A claim for breach of the implied covenant of good faith and fair dealing requires the same

6 elements [as a claim for breach of contract], except that instead of showing that defendant

7 breached a contractual duty, the plaintiff must show, in essence, that defendant deprived the

8 plaintiff of a benefit conferred by the contract in violation of the parties' expectations at the time

9 of contracting. Boland, Inc., 685 F. Supp. 2d at 1101 (citing Carma Devlopers, 2 Cal. 4th at

10 372-73). Where one party unfairly frustrates another party's right to receive the benefits of a

11 contract, the frustrating party has breached the implied covenant of good faith and fair dealing.

12 Hibu Inc. v. Lawrence, SACV 13-0333-DOC, 2013 WL 6190538 (C.D. Cal. Nov. 25, 2013). A

13 breach of good faith and fair dealing may occur when, for example, a party fails to renegotiate a

14 contract in a manner consistent with industry custom. See Celador Int'l Ltd. v. Walt Disney Co.,

15 347 F. Supp. 2d 846, 852 (C.D. Cal. 2004).

16 The License Agreement provides that, within ninety days of the License Agreements

17 expiration, REDACTED

18

19 See Dash Decl., Ex. 1 [License Agreement at 25].

20 This provision of the License Agreement affords Williams discretion in a number of ways,

21 including determination of what Williams constitutes prompt delivery and which competitors

22 offers, if any, Williams wishes to show to Entercom. Overall, this provision shows the parties

23 expectations that they would engage in good faith negotiations over a further license to the Show.

24 Williams has purposefully and repeatedly breached its duty by, among other things,

25 refusing to meet or discuss the Clear Channel offer, signaling that it would refuse any matched

26 offer by Entercom, claiming that the Clear Channel offer cannot be matched, and delaying in

27 responding to Entercoms matching offer so as to let the ten-day match window expire. See Dash

28 Decl. 19, 20, 23. Though the relief requested and the facts are similar to Entercoms breach of
MORGAN, LEWIS &
BOCKIUS LLP 11 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 18 of 22

1 contract claim, breach of Entercoms expectation in the process of negotiation is separate and

2 distinct from its breach of Williams duty to accept a matched offer, and therefore provides an

3 independent ground upon which Entercom is likely to prevail. See Celador, 347 F. Supp. 2d at

4 853. In the alternative, should the Court be inclined to find that there was discretion afforded to

5 Williams in determining what constitutes a matching offer, Entercom vigorously argues that

6 Williams failed to exercise that discretion in good faith.

7 C. Loss of Broadcasting Rights to the Show Would Cause Irreparable Harm to


Entercoms Goodwill, Advertising Revenues, and Employees
8

9 In the Ninth Circuit, intangible injuries and damages that are difficult to calculatesuch
10 as loss of goodwillconstitute irreparable harm. See Stuhlbarg Intern. Sales Co., Inc. v. John D.

11 Brush and Co., Inc., 240 F.3d 832, 841 (9th Cir. 2001) (Evidence of threatened loss of

12 prospective customers or goodwill certainly supports a finding of the possibility of irreparable

13 harm.); Rent-A-Ctr., Inc. v. Canyon Television & Appliance Rental, Inc., 944 F.2d 597, 603 (9th

14 Cir. 1991)([A]dvertising efforts and goodwill that RAC sought to protect . . . would be difficult

15 to valuate and thus constituted possible irreparable harm.); Ticketmaster L.L.C. v. RMG

16 Technologies, Inc., 507 F. Supp. 2d 1096, 1115 (C.D. Cal. 2007) (In this Circuit, intangible

17 injuries, such as damage to goodwill, can constitute irreparable harm.); eBay, Inc. v. Bidder's

18 Edge, Inc., 100 F.Supp.2d 1058, 1066 (N.D.Cal.2000) (Harm resulting from lost profits and lost

19 customer goodwill is irreparable because it is neither easily calculable, nor easily compensable
20 and is therefore an appropriate basis for injunctive relief.) Irreparable injury also occurs when

21 damages would not adequately compensate a plaintiffs loss, see Paschall v. Kansas City Star

22 Co., 441 F. Supp. 349, 358 (W.D. Mo. 1977) (business owner is entitled to continue in business

23 rather than live on the income from a damage award), the injury could lead to the loss of

24 employees, see Anselmo v. Mull, CIV. 2:12-1422 WBS, 2012 WL 5304799, at *8 (E.D. Cal. Oct.

25 25, 2012), or where the loss involves a star performer, see Wash. Capitols Basketball Club, Inc.

26 v. Barry, 304 F. Supp. 1193, 1197 (N.D. Cal. 1969); affd 419 F.2d 472 (9th Cir. 1969)(loss of

27 star basketball player is irreparable harm).


28 California statutes recognize the unique damage caused by the loss of a unique performer.
MORGAN, LEWIS &
BOCKIUS LLP 12 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 19 of 22

1 Labor Code section 2855(a), allows enforcement of a contract to perform services of a special,

2 unique, unusual, extraordinary, or intellectual character, which gives [the contract] peculiar

3 value, and Civil Code section 3423, permits injunctions for breach of such a special services

4 contract. Where, as here, an employee provides personal services of special, unique, or unusual

5 character, the employer is entitled to an injunction preventing such an employee from providing

6 services to a competitor for the term of the contract. See, e.g., Lemat Corp. v. Barry, 275 Cal.

7 App. 2d 671, 680 (1969) (star basketball player Rick Barry prevented from playing basketball for

8 another team due to his personal services contract with the San Francisco Warriors); MCA

9 Records v. Newton-John; 90 Cal. App. 3d 18, 153 (1979) (court affirms preliminary injunction
10 entered by trial court where singer was guaranteed more than $6,000); Motown Record Corp. v.

11 Brockert, 160 Cal. App. 3d 123,135 (1984); see also Washington Capitols Basketball Club, Inc.

12 v. Barry, 419 F.2d 472 (9th Cir. 1969); Houston Oilers, Inc. v. Neely, 361 F.2d 36 (10th Cir.

13 1966); Arias v. Solis, 754 F.Supp. 290 (E.D.N.Y. 1991).

14 Allowing the Show to broadcast on another terrestrial radio station in the Sacramento

15 market would irreparably harm the goodwill that Entercom has spent years building with its

16 customer base. AdvertisersEntercoms primary customers and clients, as they are the primary

17 means through which Entercom generates revenuetreat consistently high ratings as an

18 important factor in the perceived value of purchasing advertising time during a radio show.

19 Declaration of Sean Shannon (Shannon Decl.) 5. High ratings are not enough to sell
20 advertising time at top dollar; consistency in those high ratings is required. For close to fourteen

21 years the Show has been highly ranked in the Sacramento market in the ratings demographics

22 most valued by advertisers, and it is this consistent popularity which accounts for its advertising

23 revenue. Id. Even if Entercom were to immediately replace the Show with a radio broadcast

24 generating similar ratingsa difficult, if not impossible, task, since the show depends upon the

25 unique personalities of the hostsEntercom would lose the value of consistency that it has

26 worked so hard at producing. Id., 7-8. That goodwill could be lost indefinitely, as Entercom

27 would not likely be able to broadcast a show that has the same consistently high ratings. This
28 intangible loss cannot be stated in monetary terms alone, which is why the parties specifically
MORGAN, LEWIS &
BOCKIUS LLP 13 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 20 of 22

1 negotiated for specific performance in the Programming Agreement. Id. 12.

2 Losses would not be confined to goodwill and advertising revenue for the morning drive

3 slot in which the Show currently operates. Id., 9. A powerful morning show lifts the ratings of

4 the midday daypart which immediately follows it, which in turn lifts the afternoon drive daypart.

5 Id. Conversely, loss in a morning show can drag down the ratings of other dayparts. Id.

6 Predicting the ripple effect of the Shows loss would be extremely difficult. In addition, due to

7 sudden departure of the Show from Entercoms lineup, sales staff members would be required to

8 spend a significant amount of time dealing with questions and concerns from current clients

9 rather than spend that time prospecting for new clients. Id., 10. Finally, losing a key program
10 such as the Show would erode sales staffs confidence in their product, would lower

11 programming staffs incentive compensation, and would generally make employee retention and

12 recruitment more difficult. Id., 11.

13 D. The Balance of Equities Tips Sharply in Entercoms Favor


14 The third factor of the injunctive relief analysis requires the court to balance the relative

15 hardships that the parties would suffer in the event that the injunction is granted or denied. The

16 real issue in this regard is the degree of harm that will be suffered by the plaintiff if the injunction

17 is improperly granted or denied. Scotts Co. v. United Indus. Corp., 315 F.3d 264, 271 (4th Cir.

18 2002). As a preliminary matter, when the defendants conduct has been willful, the court need

19 not balance the hardship in deciding whether to grant equitable relief. United States v. Marine
20 Shale Processors, 81 F.3d 1329, 1358 (5th Cir. 1996). Here, it is undisputed that Williamss

21 conduct was willful and, thus, the Court need not consider any hardship that might inure to it as a

22 result of the requested injunction. If, however, the Court is inclined to consider and compare the

23 parties respective hardships, this factor strongly favors Entercom.

24 As set forth in Part C, Entercoms business will damaged significantly if Williams is

25 permitted to take the Show off of its air. The departure of the popular program that it spent

26 considerable resources cultivating could be devastating to Entercoms business.

27 On the other hand, Williams will suffer no damage or hardship if the injunction issues.
28 By its request for injunctive relief, Entercom merely asking the Court require Williams to abide
MORGAN, LEWIS &
BOCKIUS LLP 14 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 21 of 22

1 by the terms that it willingly entered into. Forcing Williams to honor its contractual obligations

2 can hardly be considered a hardship that warrants consideration here. Also, the very

3 contractual provision at issue requires Entercom to give the Show the exact same treatment and

4 commitment of resources that Williams has negotiated from Clear Channel, and that Entercom

5 has readily agreed to match. Given that, it is impossible to conceive of any hardship that would

6 inure to Williams if the injunction issues. Thus this factor weighs strongly in favor of granting

7 the requested injunction.

8 E. Public Interest
9 When the reach of an injunction is narrow, limited only to the parties, and has no impact
10 on non-parties, the public interest will be at most a neutral factor in the analysis rather than one

11 that favor[s] [granting or] denying the preliminary injunction. Stormans, Inc. v. Selecky, 586

12 F.3d 1109, 113839 (9th Cir. 2009) (quotations and citation omitted). Nevertheless, courts have

13 recognized that [t]he public has an interest in valid contracts being upheld. H & R Block Tax

14 Services LLC v. Kutzman, 681 F.Supp. 2d 1248, 1253 (D. Mont. 2010) (The public has an

15 interest in valid contracts being upheld.). This factor therefore weighs in Entercoms favor, or

16 is at least a neutral factor in the analysis.

17 F. A Bond is Not Required


18 The Court retains significant discretion as to the amount of security required, if any, under

19 Federal Rule of Procedure 65(c) for the payment of costs which may be incurred should an
20 injunction wrongly issue. See Barahona-Gomez v. Reno, 167 F.3d 1228, 1237 (9th Cir. 1999)

21 supplemented, 236 F.3d 1115 (9th Cir. 2001); Fed. R. Civ. P. 65(c). Here, the parties expressly

22 waived any bond requirement in the Programming Agreement. See Dash Decl., Ex. 1 at 11.

23 Moreover, [a] bond may not be required, or may be minimal, when the harm to the enjoined

24 party is slight or where the movant has demonstrated a likelihood of success. Ticketmaster

25 L.L.C. v. RMG Technologies, Inc., 507 F. Supp. 2d 1096, 1116 (C.D. Cal. 2007) (citing Jorgensen

26 v. Cassiday, 320 F.3d 906, 919 (9th Cir. 2003); Walczak v. EPL Prolong, Inc., 198 F.3d 725, 733

27 (9th Cir. 1999)). Here, there is minimal damage to Williams, Entercom has shown a likelihood of
28 success on the merits, and Entercom would be able to cover any damages should an injunction
MORGAN, LEWIS &
BOCKIUS LLP 15 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1
Case 2:14-cv-01523-GEB-AC Document 5 Filed 06/26/14 Page 22 of 22

1 wrongly issue. Therefore no security bond should be required under Federal Rule of Civil

2 Procedure 65(c).

3 IV. CONCLUSION
4 For all of the above reasons, Entercoms request for a temporary restraining order and

5 preliminary injunction should properly be granted.

7 Dated: June 26, 2014 MORGAN, LEWIS & BOCKIUS LLP


8 By /s/ Benjamin P. Smith
Benjamin P. Smith
9 Attorneys for Plaintiff
ENTERCOM CALIFORNIA LLC
10

11

12

13

14

15

16

17

18

19
20

21

22

23

24

25

26

27
28
MORGAN, LEWIS &
BOCKIUS LLP 16 PLTFS MOTION FOR TRO
ATTORNEYS AT LAW
SAN FRANCISCO
AND OSC; MPA IN SUPPT
DB1/ 79844121.1