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Warner CEO sued over sale deal

Richard Snyder says he is owed $100 million for helping Edgar Bronfman Jr. buy the music giant.

April 24, 2007|Josh Friedman | Times Staff Writer

Warner Music Group Corp. Chief Executive Edgar Bronfman Jr. was sued Monday for $100 million by a former head of book publisher Simon & Schuster, who claims Bronfman failed to pay him for conceiving the 2004 buyout of the music giant.

Richard Snyder said he helped Bronfman complete the $2.6-billion purchase of Warner Music from Time Warner Inc. but was never compensated because Bronfman reneged on their handshake deal.

Bronfman also secretly tampered with Snyder's computer before the two parted ways, Snyder claims in a 44-page lawsuit filed in New York.

An attorney for Bronfman called the claims "absolute fiction."

"Dick Snyder did not work on the Warner Music Group transaction," said Orin Snyder of Gibson, Dunn & Crutcher, "and there was never an agreement to compensate him for anything."

Richard Snyder declined to comment through a spokesman.

According to the complaint, Bronfman recruited Richard Snyder during a chance meeting in the Caribbean in late 2001, asking him to be his "consigliere" as he pursued potential acquisitions.

Bronfman's reputation on Wall Street had been tarnished, Snyder claims, after the ill-fated merger of his family's Seagram Co. spirits and entertainment business with French media conglomerate Vivendi in 2000.

Bronfman said that since he and Snyder were both "honorable men," no written contract was needed, the suit alleges.

For more than two years, Snyder said, they worked together on ventures.

Snyder initially proposed the Warner Music deal and helped arrange the financing by cultivating a relationship with bankers at Lehman Bros., he claims.

Snyder is seeking at least $100 million in damages based on what he said was Bronfman's oral promise to him for "fair and equitable" compensation.

Snyder estimates Bronfman earned more than $500 million from the transaction.

After the deal was finished, Snyder asked Bronfman for his distribution.

Bronfman allegedly told him, "Dick, I would have done this deal with or without you. That's the end of the discussion. Now you should leave."

Snyder claims that, before the confrontation, Bronfman misappropriated his personal computer and business files at the New York offices of Warner Music.

The tampering prevented Snyder from downloading or copying e-mails and other records that might help him pursue a claim, the suit alleges.

Bronfman's attorney said Snyder was given free office space by Bronfman after leaving a publishing job but was never tapped to be an advisor.

"This is a case of no good deed going unpunished," the lawyer said. "Now, years later, Dick Snyder would punish that kindness by attempting to rewrite history and try to claim compensation that is not owed him."

Warner Music was not named as a defendant. In Monday's trading, its stock slipped 17 cents to $16.35.

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