Dukes Up For Nielsen And Cumulus In New York Courtroom Today.

Lawyers for Cumulus Media and Nielsen are due in court today as the broadcaster’s high stakes legal battle with the measurement giant continues to unfold. The action gets underway at 2pm in U.S. District Court in Lower Manhattan where both parties will argue their case before Judge Jeannette A. Vargas.

Before breaking for the Thanksgiving holiday, Texas-based Nielsen attorney Scott Hvidt, partner at the law firm of Gibson, Dunn & Crutcher LLP, filed an extensive response to Cumulus Media’s motion for a preliminary injunction against Nielsen’s controversial “tying” policy. The broadcaster argues this new policy is anticompetitive.

Nielsen’s Nov. 25 data dump includes 34 exhibits, spread across 241 pages, much of it redacted. The exhibits provide clues about how Nielsen may make its case today to the court.

Among the documents Nielsen filed is an Oct. 30 Cumulus press release touting its market share gains and outperformance during the third quarter, including a 34% increase in digital revenue. Nielsen will presumably contrast this – along with a transcript of the radio group/network’s Oct. 30 earnings call, a Form 10-Q filing and various financial ratings reports – with how Cumulus portrayed its financial position in a court filing. In a legal brief last month, the radio company noted its stock is trading at “around ten cents,” its debt is “highly distressed,” and the amount of that “massive” debt — $876 million — is almost 500-times its market capitalization. “Cumulus’s cash flow is negative, meaning it is losing money,” the broadcaster added.

Key Info Redacted From Filing

Elsewhere in an avalanche of Nielsen exhibits are ones involving its much smaller radio rival, Eastlan Ratings. These include an email thread among Cumulus, Eastlan President Mike Gould and Kent Philips, a partner in FMR Associates which has a joint venture with Eastlan. There’s a link to an April 28 press release headlined “Eastlan Acceptance Spreads,” and another from Aug.18 titled “Five More Markets Go Eastlan.” Nielsen may use these to pour cold water on the Cumulus argument that Nielsen’s tying policy is a deliberate effort to block competition from Eastlan and is impeding the smaller company’s ability to compete by offering lower prices and better products to the radio industry.

Also included are a wave of transcripts, email threads and other documents designated as “confidential,” “highly confidential,” and “attorneys’ eyes only.” Some are “filed under seal,” meaning their access is limited to “selected parties” and not open for public – or press – consumption. These include sealed depositions by Nielsen Audio Managing Director Rich Tunkel and Cumulus EVP and Westwood One President Collin Jones. Also under seal is a Sept. 4, 2024, email thread among Tunkel, Jones, and Nielsen VP of Policy Nick Freeling with the subject line “[EXT]Nielsen Reporting Policy Updated Regarding Network-Owned, Non-Subscribing Radio.” A May 29 email thread among Nielsen CEO Karthik Rao, Cumulus CEO Mary Berner and Tunkel carries the subject line “Re: Meeting with Cumulus.” Numerous sealed email threads between Jones and Tunkel are included, however several don’t even include the names of the participants in the thread – they’ve been blacked out.

Contract Dispute Or Existential Threat?

While the level of secrecy might seem on par with that of military plans or intelligence activities, Nielsen says the whole dust-up is nothing more than a contractual dispute. The measurement behemoth has accused Cumulus of waging a “lawfare” campaign by using antitrust claims as a weapon to win better pricing. Nielsen says the broadcaster is weaponizing litigation to force more favorable contract terms rather than resolving what it calls a standard business negotiation.

However, Cumulus contends that Nielsen’s so-called tying policy is anticompetitive and unsustainable because it means the ratings company will not sell its nationwide ratings product to Westwood One unless Cumulus also buys its local ratings data. In the suit filed Oct. 16, Cumulus says that in September 2024, Nielsen “announced a new policy to illegally maintain its market power in both the National Radio Ratings Data Market and the Local Radio Ratings Data Markets (the “Tying Policy”). Specifically, Nielsen announced that if a national network owns, manages, operates, or has a sales or operating agreement or similar business relationship with local radio stations (a “shared-ownership local radio station”), Nielsen would exclude from the national radio ratings data purchased by the national network any geographies where the shared-ownership local radio stations do not purchase Nielsen’s local radio ratings data.”

Importantly, Cumulus-owned Westwood One cannot sell national advertising without the national numbers, Cumulus argues. And the loss of access would immediately damage revenue, client relationships, and market share, it claims.