Lawsuit Pits Jay Penske Against Former Variety Exec

It was to be called Beverly Hills Entertainment Week. But the 2012 event never happened and according to reports late last night on Deadline and TheWrap, past and present regimes of Variety are tangled up in the 90210 details.

Variety Media LLC is claiming in an April 29 LA Superior Court complaint that a $500,000 event sponsorship deal set up previously at Variety with Beverly Hills Media Group was fraudulent. In addition, the trade’s new ownership alleges that because the sponsorship deal was never properly disclosed during due diligence for the PMC-Variety deal, they are now on the hook for a penalty.

The defendants, in a counter-claim filed Tuesday, insist they tried to set up a meeting with Penske during the Variety acquisition process but were denied.* From Sharon Waxman’s report:

The complaint accuses the unnamed “executive officer” of Variety of engaging in a “fraudulent, self-dealing transaction while the assets of Variety were being marketed for sale for the purpose of diverting substantial revenues generated by Variety…”

The pleading appears to be referring to former Variety president Neil Stiles, who is listed on a cached version of the BHMG site as a member of its advisory board. (Much of the BHMG website appears to have been taken down.)

The lawsuit targets BHMG and the firm’s CEO Bert Bedrosian, not the unnamed Variety exec. Read the full complaint, counter-complaint here and here.

[Image courtesy]

*Correction – 05/08/13: Both TheWrap and Deadline had the order of things slightly wrong. It is BHMG that sued first, April 30, for breach of contract. Penske then counter-sued, May 1, for fraud. In her update, Waxman has some good details – via plaintiff’s counsel – about the record-setting $500,000 Commerce Casino sponsorship deal that Penske allegedly abruptly pulled the plug on. Read her follow-up here.