Alpha Bite: Could Founder, Former CEO Thwart Chapter 11 Emergence?
Former Alpha Media CEO Larry Wilson, who was pushed out of the company back in 2018, has filed a 191 page document with the FCC that accuses his former company of misleading the FCC, making decisions without proper board approval and challenging Alpha’s qualifications as a broadcast licensee.
Wilson’s filing makes public what has been whispered about in the industry for years; that the breakup between Wilson and its current management, including current CEO Bob Proffitt, was very messy with long friendships shattered. Alpha filed for bankruptcy earlier this year.
In his petition, which targets four Alpha license renewals, Wilson’s attorney’s say that in their 40 years of practice before the FCC they have never encountered such blatant, unlawful self-dealing by directors of a privately held licensee, flippant false certifications to the FCC and unauthorized transfers of control.
Wilson alleges two private equity funds usurped control of the privately held broadcast licensee from its Board of Directors and ran the company into the ground. He says that was done by “attempting to cut costs to achieve profitability, and then promote a prepackaged bankruptcy plan that would erase the obligations owed to secured and unsecured creditors and minority stockholders to the advantage of management and the private equity funds.”
Wilson alleges that his former company committed several illegal acts, misrepresentations and demonstrations of a lack of candor to the Commission.
He alleges the company of:
– making false certifications on multiple FCC applications.
– purporting to adopt changes to Alpha’s governing documents in a post-hoc effort to cover up past misdeeds and to remove nearly all duties owed by Alpha’s directors to the company and its shareholders
– transferring control of fundamental aspects of Alpha’s business operations to various people and entities without Board authorization to effect such transfers, and, most recently, further delegating substantial control of the company to a “Special Independent Committee,” all – ii – without publicly disclosing such transfers of control to the FCC and requesting prior Commission approval of such transfers of control; and, finally
– pursuing a foreign ownership structure with the purpose and intent to freeze the current Alpha domestic shareholders out of the company and for the sole benefit of Alpha management, private equity investors, and foreign entities.
Wilson says, “all of these facts reveal fundamental character defects that call into question the applicant’s qualifications as a broadcast licensee—and, concomitantly, the applicant’s ability to satisfy its mandate to serve the public interest.”
The petition concludes by stating “Alpha is on fire as a result of the facts and misdeeds set forth in this Petition. Petitioner therefore respectfully requests that the Commission deny the above-captioned applications or, in the alternative, designate the applications for a hearing on the issues specified in this Petition.”
Read the entire petition filed at the FCC HERE.
