Starz Sued by Former Employee For Illegal Business Dealings and Firing

Keno Thomas, a former sales and marketing SVP, says the network wanted him to falsify revenue and subscriber numbers for the board.
AP Images/Invision
Starz' Chris Albrecht

A former employee is suing Starz for allegedly firing him over his complaints of illegal business practices and gender and racial inequality within the network.

Keno V. Thomas claims the company hired him in 2004 to be senior vice president of sales and marketing. In his Tuesday lawsuit, he blames his ouster in 2014 on chief revenue officer Michael Thornton, who is a defendant with CEO Chris Albrecht and corporate owner Liberty Media.

Thomas, who is African-American, says he “prioritized the hiring of women and minorities in his department, which subjected him to ridicule at the hands of Starz' management" including Thornton once commenting Thomas' team "looks like the United Nations."

But the complaint mostly concerns the behind-the-scenes dealings of the failed Comcast-Time Warner merger.

Thomas says that at a dinner in 2014 Thornton told a group of Starz executives the network influenced Charter Communications (in which Liberty Media owns a large stake) to extend Starz’ deal with Comcast, which at the time wanted to sell subscribers to Charter to get around FCC regulations.

Thorton told the group Starz and Charter boardmember Gregory Maffei called Comcast and demanded "as a clandestine part of the Charter/Comcast deal, Comcast extend its Starz affiliate carriage deal at a loss for Comcast and a great profit for Starz. Because Starz was not privy to the Charter/Comcast deal, the only way Starz could profit from that deal was through Mr. Maffei's impermissible and duplicitous actions," states the complaint.

"Later that evening, Mr. Thomas approached Mr. Thornton about the legality of such dealings, pointing out that Mr. Thornton and Mr. Maffei's actions may constitute inside manipulation and unfair influence on a pending merger," continues the complaint. "Mr. Thornton sternly warned Mr. Thomas to never repeat what he just said because it could cost Mr. Thomas his job."

In 2013 and 2014, Thomas worked to renew Starz' deal with DirecTV until he complained to Thornton about the Comcast dealings, he said, at which point Thornton and other top executives excluded him from the deal.

Shortly before the renewal in August 2014, "Mr. Thomas quietly approached Mr. Thornton and asked if the [DirecTV] strategy was the same type of tactics used in the Comcast extension. Mr. Thornton leaned toward Mr. Thomas and threatened that Mr. Thomas could lose his job," states the complaint.

Things came to a head after the deal was done, when DirecTV refused to return Starz promptly to DirecTV marketing campaigns. Knowing the resulting revenue hit would displease the board of directors, the network’s director of finance told Thomas to "arbitrarily inflate the revenue figures and subscriber numbers," states the complaint. “Rightfully believing the requested activity to be unlawful, Mr. Thomas adamantly refused."

The company fired him in response, he says.

Represented by Hadsell Stormer & Renick, he wants unspecified damages on causes including wrongful termination and retaliation for whistleblowing, complaining of discrimination and refusing to participate in illegal activity.

Read the full complaint.

"Normally, we would not comment on pending litigation, and, in this instance the company has not even been served. However, based on reading the complaint in the press, rest assured that Starz, as well as the other defendants cited, will defend themselves vigorously against these scurrilous, unsubstantiated and offensive attacks by a disgruntled former employee," says a Starz spokesperson.