• by Wayne Friedman , December 30, 2008

The Detroit station that paid an unusual upfront fee of $1.5 million to national sales rep firm Petry Media now says it was promised $10 million to $12 million in advertising.

According to Dody Johnson, director of marketing/public relations for WADL Detroit, Petry promised to hit a goal of at least $10 million. According to court documents, the deadline for Petry to achieve those ad sales ranged between October 2008 and April 2009.

Kevin Adell, chief executive officer of Adell Broadcasting and Earl Jones, then president/CEO of Petry Media Corp., agreed to an amendment on its original station-sales rep contract, where the station provided the rep firm with an unusual $1.5 million upfront fee. The amendment was signed on April 24, 2008.

At that time, Adell knew the $1.5 million fee was "not typical in the television advertising industry," but was convinced that Jones' efforts would yield the promised results.

But eight months into the deal--and two months after Earl Jones was replaced by Val Napolitano as the chief executive of Petry--the station took action because Petry had sold only $252,650, according to the lawsuit filed by WADL.

In September 2008, the station asked for Petry to return the $1.5 million. Petry refused, according to the lawsuit, which was filed in early December in Michigan's Macomb County. After applying the commission rates from the original agreement of 15%, the station says this meant that only $37,890 was paid back against the $1.5 million charge.

The original station-rep deal between the station and Blair Television, one of Petry's advertising selling units, was signed in October 2007. At that time, a more standard contract was signed, in which Adell Broadcasting agreed to pay a 15% commission on net billings for advertising time sold by Petry, according to court documents.

In addition, an initial fee of $75,000 was to be paid, a "commission credit to be applied to that sum."

For 20 years prior to 2007, WADL was a TV station that aired home shopping and infomercials. In 2007, it decided to change its format to air syndicated TV shows, such as "Chappelle's Show" and "Sanford & Son," as part of an urban programming TV format. That, in turn, had station executives looking for a national TV sales rep company.

Calls and emails were not returned by Petry representatives by press time. An attorney for WADL had no comment.