Fox: Adelphia Owes Us $20M


Fox Cable Networks Group has joined the programmers that claim Adelphia Communications Corp. owes them money, with the News Corp. unit looking to collect more than $20 million, according to court documents.

Fox Cable, Game Show Network and International Channel Networks are all lodging claims against the scandal-ridden MSO, according to a petition filed by the New York City law firm Carter, Ledyard & Milburn, which says it represents all three programmers.

In June, when Adelphia filed for Chapter 11 bankruptcy protection, the MSO presented a list of its top 50 unsecured creditors, which typically only recoup a fraction on the dollar. The top 50 included a batch of cable networks with claims, in total, of roughly $170 million in overdue license fees.

Programmers on the list ranged from Home Box Office, which is looking to collect $34 million, to Black Entertainment Television, owed $4 million.

Fox Cable wasn't on that Top 50 list, but the new court filing says the company — which owns or operates services such as FX and a variety of regional sports networks — is owed roughly $20 million in license fees for its programming.

"The $20 million is spread out over the 18 of our 22 channels that Adelphia carries," said Lindsay Gardner, Fox Cable's executive vice president of affiliate sales and marketing. "That's an average of $1.33 million per channel."


Aaron Cahn, the Carter, Ledyard lawyer handling the matter, said debtors like Adelphia do their best when they submit a list of their major unsecured creditors. But Cahn added that this "information is subject to correction."

Apparently, taken individually, the money owed to each Fox-owned cable network was too small to make the Top 50 list, but combined, they hit the $20 million mark.

GSN and International Channel are both seeking $1 million in license fees from Adelphia, according to the recent court filing, which also lists Starz Encore Group LLC.

Starz Encore made the Top 50 creditor list in June, but was only seeking $11.2 million back then. Now, that figure has been updated and increased, to $21 million. A Starz Encore spokesman said the larger figure represented the latest, updated calculation of what the programmer is owed.

The June Top 50 list also included The Walt Disney Co.'s fully-owned networks, ESPN and Disney Channel, indicating that Adelphia owed the programmers a combined $14.2 million. Lifetime Television, of which Disney owns half, was due $4.1 million. But apparently, Disney is owed even more than that.

Last week, during a conference call with analysts, Disney chief financial officer Thomas Staggs said Adelphia's troubles resulted in a roughly $50 million impact for the fiscal third quarter.

"The timing and degree of recovery on those amounts is not yet certain, with Adelphia's new financing package in place, it is our expectation that our business there will resume its normal pace," Staggs said.

The newest claims mean that Adelphia owes programmers well north of $200 million.


C-SPAN hasn't been named in any court filing, but Adelphia also owes it license fees — reportedly in the $3 million range, according to sources. It's an ironic turn of events, since Adelphia founder John Rigas, who's been charged with fraud along with his sons, is on C-SPAN's board.

Programmers said Adelphia made it a practice of not paying monthly license fees to programmers on time, instead waiting months before doling out the money. As a result, many networks are owned several months worth of fees, adding up to millions of dollars.