SFX To Defend Lawsuit By Music Managers

(RTTNews) - SFX Entertainment, Inc. (SFXE) late Wednesday said it would vigorously defend a lawsuit filed by some alleged co-founders.

Three music managers claimed that they helped create the producer of electronic dance music events but were deprived of their stock worth over $100 million. SFX raised $260 million in its initial public offering last year.

Industry veterans Paolo Moreno, Lawrence Vavra and Gabriel Moreno said in a complaint in federal court in Los Angeles that they used their contacts to help the company make strategic acquisitions.

But they were "frozen out" by SFX Chief Executive Officer Robert Sillerman and did not get their founders' shares as promised.

In a statement, SFX said, "We will have no comment, other than to say we will vigorously defend this baseless lawsuit."

SFXE fell 8.2 percent on Wednesday to close at $8.40.