LOS ANGELES, Calif. -- General Media Communications, an affiliate of Penthouse, filed a lawsuit March 16 in Los Angeles Superior court against Twistbox Entertainment's Waat Media, claiming breach of contract.
Both General Media and Penthouse are subsidiaries of parent company Friend Finder. Twistbox was to distribute material branded by the Penthouse trademark and name for mobile content and failed to keep up its payments for such, the lawsuit said.
According to the filing, General Media and Twistbox entered into a mobile content distribution agreement in May 2006, followed by an amended agreement on February 2008, with an additional amendment in November 2008. The terms of the agreement defined "digitized works" and "photographic, videographic, audio, audiovideographic and/or text content" digitally distributed via a cellular or mobile telephone system to mobile telephone handsets.
The filing continues on to say General Media claims agreement details included minimum guaranteed payments due from Twistbox, irrespective of revenues earned. This guarantee was included "to protect plaintiff by providing it with a minimum compensation in exchange for its providing defendants with the valuable licensed rights in the eventuality that Defendants' revenues were lower than anticipated."
The "Minimum Guarantee Payment" claimed for the lifetime of the agreement came to $5,54 million and General Media asserts that of September 30, 2008, the amount of more than $4 million was outstanding. As a result, General Media notified Twistbox it was in breach of the agreement and all rights would be terminated within 30 days unless the proper payment was made.
On January 26, 2009, Twistbox was notified by letter that the agreement has been terminated and General Media reserved all rights and claims.
Now, General Media is seeking the outstanding balance of the "Minimum Guarantee Payment," or $4,085,000, as well as interest at a rate of 1.5 percent as stated in the agreement or "the highest interest rate allowed by law, compounded monthly." Also being sought are monetary damages and "costs, expenses and reasonable attorneys' fees, without limiting other sums and relief available."
Ira P. Rothken of the Rothken Law Firm is representing General Media in the suit.
"The company stands behind the filing and looks forward to obtaining a reasonable remedy," Rothken told AVN Online.
According to its website, Waat Media has offices in the U.S. and Europe, with a headquarters in Sherman Oaks, Calif. No company representative was available, but the receptionist said, "As a publicly traded company, the company is unable to make a comment."