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October 14, 2005

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Publication Date: Friday, October 14, 2005

Clear Channel puts up $3.6 million ante Clear Channel puts up $3.6 million ante (October 14, 2005)

Judge rules city can eject media giant from Shoreline

By Jon Wiener

A county judge last week rejected a request by Clear Channel to issue a temporary restraining to prevent the city from terminating the company's lease at Shoreline Amphitheatre.

The ruling leaves the city the option of booting the company, even before a trial over the amphitheater's operations begins Feb. 6. A city-sponsored audit says the company has underreported revenues by at least $20 million since 1999, and the city has charged it with theft of public funds and racketeering.

Lawyers for both sides met in the judge's chambers last Wednesday. After losing the ruling, Clear Channel posted a $3.6 million bond with the court to cover damages the city is claiming under the audit, released in late August.

"If they really thought the report was deeply flawed, I don't think they'd post [the bond]," said city attorney Michael Martello. "They can't take the risk that all or part of that report will be proven at trial."

Martello sent the company a letter in early September giving it 15 days to pay the $3.6 million in back rent and penalties, and to open the rest of its books to auditors. After Hurricane Rita forced Clear Channel executives to evacuate their Houston offices, the city extended the deadline for three weeks.

Clear Channel did not let the auditors ask executives questions. Company officials, who would not comment for this story, previously called the audit "misleading" but did not elaborate.

E-mail Jon Wiener at [email protected]

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