LAUNCH SECURES FUNDING

Launch Media today announced that it has completed a $2 million short-term secured debt financing from a major media company.

Company representatives thus far refuse to name the company but say you would be totally blown away if you saw how rich and cute and smart and nice it was.

This financing replaces the secured convertible note financing that the company had previously announced pursuant to a non-binding letter of intent. Whatever that means. In any case, it clearly replaces the $5 million the netco recently boasted it would receive (see story link below)—and the dude who got an I.O.U. after buying the company a six-pack is not happy.

On Friday, the RIAA dropped the legal hammer on Launch, alleging that the company’s licenses with Universal, Sony, BMG and EMI do not allow for the level of interactivity and customization offered by the its LaunchCast service, which allows users to decide how often they want to hear particular songs (hitsdailydouble.com, 5/25).

In response to the suit, Launch removed LaunchCast from its site.

"We strongly believe that LaunchCast complies with the [Digital Millennium Copyright Act], and we plan to continue talks with the RIAA to ensure a positive outcome for both music lovers and the music industry," Launch CEO and co-founder David Goldberg said in a statement. "Certain features of LaunchCast may be temporarily suspended until we have come to an agreement with the parties in regard to its operation. In the meantime, enjoy our exciting text offerings."

Goldberg added, "We’re hopeful we’ll be able to work this out very quickly without litigation."

News of the RIAA lawsuit negatively affected Launch stock on Friday, dropping it to 29 cents a share at market close. In trading on Tuesday (5/29), however, the stock notched a slight comeback, rising to 44 cents a share by midday, still far below the company’s 52-week high of $9.75.