Sellout Crowd

[soonerguru]

Most those writers had already been laid off and I'm sure Tramel and Carlson were not getting increases and I know all the writers there had been forced into periodic unpaid furloughs.

Even if Tramel is on the line for the debt, he can file bankruptcy and move on.

Nobody else involved left a steady job, except... Jenni Carlson. Good luck finding another full-time writing gig when you already have 95% layoffs and all those people are taking peanuts just to have some income. Tramel hustled up and took the job at the World but you can bet that was at a significant salary reduction.

Most would be shocked to know how little freelance writers are paid these days. Most earn around $20-$50 per article.

We need media to have a functioning democracy. It's a real conundrum. Media enterprises were fat and happy and have continually failed to adjust. There has to be a way to make it work financially, but even the current pay wall thing is broken.

I don't understand why these former newspapers don't create a Spotify-type concept for local media organizations. Am I going to pay to subscribe to the Austin Statesman to read one article. No the hell not. But, what if I paid 10.99 a month to read content from any organization I want?

There has to be a way.

[Pete]

^

The problem is that people like the Gaylords and other monopolists took millions and millions out of their businesses, then when digital came along, their massive hubris led them to give away their content thinking that somehow it would all work out.

And after they had screwed things up beyond salvation and the free genie was out of the bottle, they cashed out instead of reinvesting some of those big piles of money.

It wasn't enough they ran their own business into the ground, they made sure the entire industry would never again have a workable business model.

The only savior is citizen journalism. For so long, the battle cry of the failing papers was something like, "We actually have people covering city council meetings and nobody else does or will". It was the 'public good' appeal after they were all on the brink of ruination, even though there is a very, very strong argument that says those big institutions were only lining the their own pockets and those of their cronies. And of course in OKC, we now have a bunch of independent outlets covering City Hall way better than the Oklahoman ever did, especially since the paper was/is in bed with the city and local power players.

[soonerguru]

If you use completely falsified projections to lure investors and employees, that is straight-up fraud.

And it's easy to prove because you have all these proformas that were sent to everyone who signed on, and then you have several months of actual revenue to compare. Also, it sounds like most were told they had $3 million in "investment capital" when in fact it was just a loan. That's also fraud.

Exactly. While it's true their chances of getting anything from a lawsuit are practically nil, there is good reason for them to pursue criminal charges.

[Pete]

There is now a civil lawsuit filed in this matter.

Big Dog Media LLC (the estate of Toby Keith, Bob Stoops, and Switzer son-in-law Hunter Miller) are suing 4 people from Sellout Crowd who all signed separate personal guarantees for an unpaid loan balance of over $600K:

Berry Tramel (sportswriter)
Mike Koehler (former Oklahoman employee and partner in Smirk Media)
Mike Sherman (former Oklahoman)
Kris Murray (partner at Spark Creative and son of long-time sports broadcaster Ed Murray)

The last 3 guys were pretty much running Sellout.


This suit does not include the many employees of Sellout who are owed tens of thousands of dollars by the guys running the show. They may never file because this loan debt will come first and I suspect all four defendants will file bankruptcy.

There is still the possibility of criminal charges over what is alleged to be numerous outrageously fraudulent assertions by the owners.

[Pete]

So, to summarize:

Koehler, Sherman and Murray launched Sellout Crowd with little to no investment and instead took out a 12% $1.5 million line of credit from Keith, Stoops, and Miller.

They recruited Tramel and a host of other local sportswriters by promising big money, including base salaries for the first three years plus a percentage of advertising revenue.

The owners made outrageous projections about advertising income that were easily 100x anything remotely feasible.

The writers claim they were told that the start-up had $1.5 million in investment, when in fact it was all borrowed money.

Almost from the launch in September of 2023, Sellout started missing payments to the writers under contract.

Sellout never seemed to sell any advertising of value.

A few months later, they stopped making payment on the loan.

Mike Koehler was forced out, they laid off most of their writers.

A couple months later, the whole thing collapsed.

[BoulderSooner]

So, to summarize:

Koehler, Sherman and Murray launched Sellout Crowd with little to no investment and instead took out a 12% $1.5 million line of credit from Keith, Stoops, and Miller.

They recruited Tramel and a host of other local sportswriters by promising big money, including base salaries for the first three years plus a percentage of advertising revenue.

The owners made outrageous projections about advertising income that were easily 100x anything remotely feasible.

The writers claim they were told that the start-up had $1.5 million in investment, when in fact it was all borrowed money.

Almost from the launch in September of 2023, Sellout started missing payments to the writers under contract.

Sellout never seemed to sell any advertising of value.

A few months later, they stopped making payment on the loan.

Mike Koehler was forced out, they laid off most of their writers.

A couple months later, the whole thing collapsed.

seems from interviews the Tram didn't understand what he signed .. which if true .. is so so irresponsible of him

[Pete]

seems from interviews the Tram didn't understand what he signed .. which if true .. is so so irresponsible of him

The lawsuit includes the guarantee that Tramel and the others signed.

It's very plain and cut-and-dry. I understand Tramel may have been misled with words, but he signed this document:

[Pete]

That guarantee was signed 9/5/23, which was a few days after Sellout was launched.

Tramel is now claiming duress; that he found out they had no money and was more or less backed into a corner:

From that Frontier article:

“I’ve often wondered what I would have done had I known that (the company was primarily funded by a loan,)” Tramel said. “But what was I supposed to do? I’d already signed a contract with these crooks and quit my job of 32 years. And now I’m working for a company that has no money except a $1.5-million line of credit.”

[Laramie]

Outstanding reporting Pete . . .