OTTAWA – Earlier this month, the CRTC withdrew an application by Fight Media to effect a corporate reorganization so that the new company could acquire category two digital specialty channel The Fight Network from The Fight Network Inc.
For those not familiar with media company re-orgs, that sentence may sound a little weird, but these types of alterations to media company ownership structures are not all that unusual and can be done for a number of reasons.
But this time, the Commission withdrew the application prior to the May 5th hearing because of a lawsuit brought by Mike Garrow, the founder of The Fight Network. Despite being let go in August 2008 by the company he founded, Garrow says he and others remain shareholders – and he was wrongfully dismissed from the company in 2008. So, he filed an intervention with the Commission on the corporate reorganization.
“The Commission notes the existence of an ongoing civil proceeding in the Ontario Superior Court, which, among other things, involves a dispute over the ownership of the voting shares in The Fight Network (TFN) Global Inc., the owner of the current licensee, TFN Inc.,” says a letter from CRTC secretary general Robert Morin in a letter to Fight Media president Edwin Nordholm.
“The Commission notes that it was unaware of this proceeding when it placed Fight Media Inc.’s application on the agenda for this public hearing, and that the existence of the civil proceeding was only brought to its attention through interventions filed in opposition to Fight Media’s application.
“The Commission further notes that the resolution of the dispute regarding the ownership of voting shares in TFN Global Inc. falls within the jurisdiction of the Ontario Superior Court.”
In his intervention which brought the suit to the Commission’s attention,, Garrow informed the Commission of the lawsuit he has brought in the Ontario Superior Court of Justice
“The reason for my objections are many, they cross the areas of both professional, and personal,” reads Garrow’s letter.
“Myself and other TFN Global shareholders have filed this suit in an attempt to gain disclosure as to how the company under the parties listed above has fallen into such disarray and so called insolvency as Mr. Nordholm has only sent us emails to this effect yet despite repeated request for documents to verify his claim none to date have ever been offered or disclosed.”
The Fight Network’s financial summary filed with the CRTC shows the channel lost close to $4.9 million in the broadcast year 2008, ended August 31st that year, on total revenues of $2.17 million with 522,000 subscribers. The channel’s 2009 financial results do not appear on the Commission’s web site, which released that year’s figures from nearly all other channels on April 22. However, The Fight Network’s web site said in late 2009 it had surpassed the million-subscriber mark.
Stay tuned for the next round in this battle.
– Greg O’Brien
