Online music retailer N2K Inc, already embroiled in a complex merger with CDnow (CI No 3524), has been hammered by a pair of lawsuits. First off was Ticketmaster Corp, which accused N2K of breach of contract for violating the terms of a marketing agreement and defaulting on a payment. Earlier this year N2K signed with Ticketmaster to make its Music Boulevard Ticketmaster’s exclusive online music store. The deal called for N2K to pay $12m over two years, in return for which Ticketmaster would provide sales, marketing and advertising. The first $3m payment fell due on Sunday November 1. On Monday N2K told Ticketmaster it did not intend to honor the agreement. Ticketmaster complained to Los Angeles Superior Court that it had performed all its obligations under the contract. N2K disagrees. It says Ticketmaster was the first to default on the terms of the deal, and that N2K had told it so. Rather than attempt to remedy these breaches, Ticketmaster has brought this action and rejected N2K’s attempts to settle this matter, the company said in a prepared statement. We clearly have the duty to defend against this unwarranted action. Now Reuters reports that shareholders have sued to prevent CDnow from acquiring N2K. They believe the $101mprice ticket wasn’t high enough and that executives should have held out for a better deal. Half music publisher, half internet store, New York-based N2K has long suffered an identity crisis. In August it cut staff and slashed spending on its record label so as to concentrate on web-friendly recording artists.
