It looks like this time, the Native Americans will emerge victorious.
Jerry Powers, the co-chairman and CEO of Plum TV and it nascent publishing operation, has been accused by the Mohegan Sun casino of welshing on a $1.2 million gambling debt that he racked up in a marathon blackjack session back in May 2009.
Shortly after Media Ink got on his trail — not to mention a tense meeting with the eight-person Plum Media board last weekend — Powers decided to pay up, ending an 18-month legal battle in which a Connecticut judge had cleared the way for Mohegan Sun to attach some of Powers’ assets.
At first, the millionaire Plum executive sought to appeal, but is now reversing himself and is ready to fork over the wampum.
“Jerry is currently in settlement discussions with Mohegan Sun to drop his appeal and pay his gambling obligations in full,” a spokesman for Plum TV told Media Ink.
Court papers claim that Powers stopped payment on a $465,000 check and other checks were returned because they were written against accounts that had been closed. In court proceedings, Powers did not claim it was an error or mixup but rather that the Mohegan Sun had no right to sue him in Connecticut state court because it is a sovereign Indian nation.
He also claimed that the Mohegan Sun, in granting him a virtually unlimited line of credit, had engaged in an illegal gambling contract.
Connecticut Judge Robert Leuba rejected both arguments and gave the Mohegan Sun the right to attach his assets to reclaim the debt.
Powers had reaped a fortune when he and his partners sold Ocean Drive magazine to the Las Vegas-based Greenspun Media Group for $33 million, but his involvement had ended shortly thereafter.
He stayed on board for awhile after the sale but was eventually forced out of the company two years ago.
Five months ago, after a non-compete expired, he decided to invest with Plum TV, was named co-chairman and chief executive officer and embarked on a strategy to push the company from a small-audience TV cable operation with bases in Miami, the Hamptons, Nantucket and Martha’s Vineyard, as well as Vail, Aspen and Telluride, Colo., into the regional luxury magazine world from whence he came.
Last week, he filed an appeal with the State Appellate Court to overturn Judge Leuba’s ruling. That had the potential for some high-level embarrassment, not to mention the potential for a Native American board seat on Plum TV if he lost. Powers is a board member, along with a member of the Jonathan Tisch family, and Plum co-founder Tom Scott, New England Patriots President John Kraft and film producer Cary Woods.
A spokesman now ascribes Powers’ problems to substance abuse, which he has battled in the past. “It comes from a dark pe riod in his life two years ago,” said the spokesman. “He fell off the wagon and is in recovery. It is unrelated to his involvement with Plum.”
Powers told the board via phone on Saturday that he planned to pay the debt.
BLOOM REORG
One of the dirty little secrets of the super successful Bloomberg LP, founded by Mayor Mike Bloomberg, is that its media holdings in magazines, TV, radio, etc., that are aimed at consumers bleed tens of millions dollars in red ink annually, while its terminal business serving traders around the world reaps a fortune that easily papers over those losses.
That may be changing.
The privately held company, which had an estimated $7 billion in revenue last year, is taking yet another step that it hopes will put its smaller, money-losing consumer-focused media holdings on a path to eventual profitability.
Yesterday, the company said it was combining the business operations of its monthly Bloomberg Markets and the weekly Bloomberg Businessweek into the same operation as the television, radio, Internet and mobile businesses that were once housed under Andy Lack‘s Bloomberg multi media division.
Businessweek was losing money when the company took it over from McGraw-Hill and after a bumpy first year, seems to be turning around. Bloomberg Markets, which recently made its first pitch on newsstands, is also seeing ad page growth.
The new group is now being called Bloomberg Media Group.
The internal announcement went out from President Dan Doctoroff, the former New York City deputy mayor for economic development.
The company insisted that the changes apply only to the business side and that the company’s longtime Editor-in-Chief Matthew Winkler, who pioneered the news operation from its inception, and Chief Content Officer Norman Pearlstine, a former editor-in-chief of Time Inc., who has been very involved in overseeing Bloomberg Businessweek, will not see their roles change.
The only official shuffle in the restructuring involves Paul Bascobert, the president of Bloomberg Businessweek, who sees his role expanded somewhat to become head of business operations in the new group, while keeping his Businessweek duties. The company said it expects BBW to finish the first quarter with 312 ad pages, up 49 percent from a year earlier.
Bascobert now reports to Lack.
Doctoroff has said that the company is committed to having each of the media properties stand on its own. Each unit has a different timetable to reach profit, however, and nobody yesterday was disclosing when that was — either individually or collectively.
REDDIT OR NOT
Si Newhouse‘s Advance Publications, the parent company of Condé Nast, is taking the somewhat unusual approach of looking at offers to sell a portion of its Reddit to an outside investor.
The company, controlled by the Newhouse family, doesn’t seem hard-pressed for cash at the moment, after selling off some $500 million in Discovery Channel stock last year. On the other hand, with most of the founders who sold Reddit to Condé Nast five years ago now gone from the company, it may be looking to find a good strategic partner for the social news site.
The All Things D Web site said that is exactly what is happening, with Condé Nast placing a valuation of $200 million on the property and soliciting offers for a partial stake. Another source said the company is not hungry for cash but as the site has skyrocketed, some bankers and venture capitalists have approached Condé Nast. The company, which traditionally eschews partnerships, appears willing to listen this time.
Steven Newhouse, head of Internet operations for Condé Nast, would only say, “Reddit is an essential asset to our company.” He points out it has grown from 500,000 users and 30 million page views per month when it was purchased to 15 million users and 1 billion page views per month today.
He did try to shoot down reports that Condé, with its old- media tradition in the magazine world of Vogue, Vanity Fair and the New Yorker, was having trouble hiring developers for Reddit after the founders took off. He said they have narrowed a search down to five strong developers and noted, “we’ll be an nouncing new Reddit developers as early as next Monday.”