Lawsuit against RCA and RCA lost!

[julianburke]

Here is a lengthy document in which RCA was sued for defective equipment from start to finish in building a UHF station in Texas and as a result, the station went bankrupt in less than a year after going on the air. RCA was found to be liable and had to pay $1 million for this one. Notice the TK42 camera that never worked and was shipped as such! Also a parted out & scrapped film chain camera system that wasn't supposed to be sold and was shipped to them! No wonder GE had a strong presence down there! Let's see, when was Sarnoff's son canned as Chairman of the Board? What a major screwup for RCA and who oversaw this catastrophe??

Quote: "The evidence showed that RCA did deliver three different cameras which were inoperable. RCA sent Fredonia a TK-42 camera, costing $27,000, which John Barbour, an employee of RCA's project management department, testified was inoperable. The testimony of John Cassidy, RCA's Manager of Project Management and Administrative Services, corroborates Barbour's account. RCA also sent Fredonia a TK-26 camera which Barbour admitted had been subject to cannibalization. An RCA internal memorandum showed that this camera was intended to be scrapped by RCA and not sold. A second internal RCA memorandum shows that RCA considered the TK-26 camera not fit for resale or refurbishing after Fredonia returned the camera to RCA. A TP-6 projector RCA sold Fredonia was also intended to be scrapped as shown by an RCA internal memorandum. RCA contends that the TK-26 camera and the TP-6 projector were repaired before the station went on the air and did not cause a delay."

Seems like RCA was floundering as early as this 1973 lawsuit! (and likely earlier-did RCA get smug in their dominance of broadcast around this time?)
BTW, it looked like they were buying some used and refurbished equipment. A TK42 was $62,000-67,000 new.

http://www.altlaw.org/v1/cases/522085

[Sandy G]

Wasn't Sarnoff's son basically regarded as little better than a clueless dolt who only got where he was because of his daddy ? "Our Bobby", I think they called him... That may have been unfair, RCA's competitors-the Japanese, were gaining strength, & RCA's heavy handedness in times past didn't help...

[bgadow]

Very interesting reading! Gives some clues as to what it took to get a tv station on the air, equipment pricing, etc. I'd have to say, after going through all that, RCA seemed to have a pretty good case.

[Findm-Keepm]

RCA did win, in the retrial in 1978:

http://www.altlaw.org/v1/cases/509483

They vacated all judgments against RCA.

Cheers,

[Brian]

Actually, the 2nd appeal reversed and remanded bcause of the conflict of interest by the judge as a result of the law student. It only clarified the basis of liablity for the computation of damages that can be sought at the 3rd trial and the foreclosure of claims by the station at the 2nd trial. However, as the 2nd trial is before a judge in conflict if there was a 3rd trial the 2nd tral would be cnsidered as not have happened while and stipulations by the parties during the 2nd trial could be upheld by the judge in the 3rd trial as they were voluntarily entered into by the parties.

The appeals court seems to be flagging there are damages against RCa in thier view but they can not comment as that is not their job but, as they went into the detail of the calculation they were sending a messege to both sides as to how they should view the exposures,. This type of opinion sends a message to RCA that the appeals court does not see how they have clean hands and sends a message to the station that RCA is not going to be libel for the overall losses of the investors. It forms a good basis for the sides to meet and negotiate a settlement.

Maybe a budding law student should Shepardize the case and see what happens on remand.