A legal battle is brewing between the owners of Mandatory FM that could jeopardize the radio station’s future.
Marion Cole is a shareholder of Mandatory Broadcasting, Inc. and has filed a petition in the 266th Judicial District Court seeking to stop John and Pamela Hollinger, as officers, directors and shareholders of the radio station, and Tony Heady, individually, from causing damage to the business.
Cole is represented by local attorney Kim Pack Wilson while the defendants are represented by Heath Allen, another local attorney. Both have declined to comment on the case.
The petition states that in March 2008, the Hollingers obtained a $600,000 loan for the purchase of the station, which was secured by approximately 319 acres of land in Erath County owned by Cole.
Problems arose when Cole became aware of alleged mismanagement on the part of the Hollingers, including failure to pay employee payroll, failure to file payroll tax returns and failure to pay payroll taxes in 2008 and the first quarter of 2009.
The petition also states the Internal Revenue Service levied all accounts held in the station’s name.
In addition, the petition alleges that the Hollingers entered into “a transaction” with Heady, an employee of Mandatory FM, without Cole’s consent by facilitating the transfer of a radio frequency license, “an asset of the corporation and substantial part of the value of the business,” into Heady’s name.
In the petition, Cole requested an injunction barring the Hollingers from managing the day-to-day business and financial affairs at the station and barring Heady from taking action in respect to the frequency license.
The doors to the station, located at 471 Harbin Drive in Stephenville, were locked Thursday afternoon. A sign posted by the property’s management said the doors were locked due to failure to pay rent.
As listeners tuned in Friday to 107.9 FM, the beat went on, but the customary live broadcast was replaced by feed with the control panels on auto pilot.
While the future of the station remains unknown, the case will begin to unfold Monday during a scheduled hearing in the 266th Judicial District Court.