The Brag Media founder and former CEO Luke Girgis has launched legal action against ASX-listed Vinyl Group, the company that bought his publishing business.
He is claiming $2 million which he alleges he lost when Vinyl terminated his employment.
Vinyl reportedly paid $8 million to acquire the youth publisher, and its titles TheBrag.com, The Music Network and Tone Deaf, and Penske Media Corporation, plus Rolling Stone and Variety in Australia and New Zealand, in December 2023.
The Brag Media network was said to reach about ten million users a month with more than 40 million monthly page views.
Vinyl said it is “vigorously” defending the legal action in the NSW Supreme Court and intends on lodging a crossclaim alleging breaches of the share sale agreement.
“Following an external investigation, Mr Girgis was terminated,” Vinyl said in a statement released to the ASX.
“Under the terms of the share sale agreement, the performance payment was contingent on specific financial targets being met and subject to Mr Girgis’ employment agreement not being terminated other than for cause or where Mr Girgis being convicted of an indictable criminal offence or any act of fraud.
“These financial targets were not achieved by The Brag Media business, despite Vinyl successfully implementing operational improvements, reducing costs by more than $750,000 as previously disclosed, whilst growing second half CY revenues over the same period in 2023 by 12%. As a result, the company maintains that no performance payment is due.”
Vinyl Group this month announced media division, Vinyl Media, which will house both its owned and licensed titles.
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